ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Wednesday, April 8, 2009

When relational contracts go bad

Aaa TAaawo major players in the technology field are going toe-to-toe in Delaware chancery court over reciprocal licensing agreements for each other’s technology.  NVIDIA Corp., which says it has a license to use Intel Corp. processors in its “MCP chipsets,” was sued last month by Intel (complaint here).  Intel is seeking a declaratory judgment that NVIDIA has no right to use its processors in NVIDIA products

NVIDIA last week responded. Its answer claims that back in 2004 each party licensed the other’s technology.  The goal, it says, was to allow each company to compete head-to-head against the other in the growing field of graphics processing.  Now that NVIDIA’s products are trouncing Intel’s in the marketplace (says NVIDIA), Intel is using the litigation to try to regain a competitive advantage. In its counterclaims argue that the litigation is part of Intel‘s effort to “eliminate a competitive threat.”  NVIDIA has filed counterclaims (here) for, among other things, breach of contract and breach of the duty of good faith.

[Frank Snyder]

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