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Issued: Ten patents issued during 1988, 1989�93, and 1995�96 Prosecuted by: 1998 patent: William Holloway, Maura Moran; 1995�96 patents: Denis Maloney, and Arthur Fisher (in-house); 1989�93 patents: New York’s Kenyon & Kenyon Litigated by: Shepard Remis and Paul Ware, Jr., of Boston’s Goodwin, Proctor & Hoar; Herbert Schwartz, Kenneth Herman, Jesse Jenner, and Mark Bloomberg of New York’s Fish & Neave; Martin London, Martin Flumenbaum, and Carey Ramos of New York’s Paul, Weiss, Rifkind, Wharton & Garrison; and Thomas Siekman and James Shaughnessy of Digital Equipment Corporation Microchips may be getting smaller, but the value of Digital Equipment Corporation’s microchip-manufacturing technology patents has gotten mindblowingly bigger. In 1997 Digital won a $1.5 billion settlement from Intel Corporation, a serious bite out of the cash generated by Intel’s extraordinarily successful Pentium chip. Back in May 1997, Digital accused Intel of “willfully and deliberately” using Digital’s patented technologies to boost the performance of Intel Pentium microprocessors. Digital filed suit in Massachusetts federal court. Digital’s filing surprised the computer industry. Digital is also an Intel customer, and it used Intel chips in some of the PCs it manufactured. Intel responded by filing a breach of contract suit in California federal court. In October 1997, Digital and Intel settled the disputes in a way that secured Intel’s dominant role in the microprocessor market and filled Digital’s coffers. Intel paid Digital $1.5 billion. Digital then sold Intel its microprocessor manufacturing plant in Hudson, Massachusetts. The sale of the plant accounted for $700 million of the agreement. Great patents do not necessarily guarantee corporate longevity, however. In 1998, Compaq Corporation bought Digital, bringing an end to Digital’s independent corporate identity but not the patent portfolio or the licensing revenue.

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