Intel asks U.S. court to revive antitrust case against SoftBank-backed Fortress

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  • Intel accused Fortress of breaking antitrust law with patent aggregation, demands
  • Appeals court panel questioned whether Fortress’ conduct amounts to antitrust violation

(Reuters) – A three-judge panel of the 9th U.S. Circuit Court of Appeals weighed dueling arguments Tuesday in Intel Corp’s bid to revive its antitrust lawsuit against SoftBank-owned Fortress Investment Group LLC.

The panel voiced some skepticism of Intel’s argument that Fortress and affiliated entities broke U.S. antitrust law by stockpiling patents and using them to extort tech companies.

VLSI Technology, which is owned by investment funds that Fortress manages, won $2.2 billion from Intel in a patent case in Texas last year and has other lawsuits pending against the chipmaker.

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Intel and Apple Inc sued Fortress in 2019 for alleged antitrust violations based on its patent activities. Apple withdrew from the case last year, and U.S. District Judge Edward Chen dismissed the lawsuit months later.

Chen found that Intel had failed to show Fortress’ patent aggregation had anti-competitive effects on pricing.

U.S. Circuit Judges Mary Schroeder, Johnnie Rawlinson and Daniel Bress on Tuesday grilled Intel attorney Seth Waxman of Wilmer Cutler Pickering Hale & Dorr about his definition of “pricing,” which he said were the royalties that Fortress-related entities would demand to use the patented technology.

Rawlinson pressed Waxman for case precedent to support his argument and then asked if he was “actually asking us to redefine ‘price’ for purposes of antitrust law.”

The judges also questioned Fortress attorney Morgan Chu of Irell & Manella about Intel’s claim that Fortress had been able to unlawfully inflate its demands by aggregating potential “substitute” patents.

Chu told the court that Intel “had three tries at pleading an antitrust case and has failed to do so.”

The case is Intel Corp v. Fortress Investment Group LLC, 9th U.S. Circuit Court of Appeals, No. 21-16817.

For Intel: Seth Waxman of Wilmer Cutler Pickering Hale & Dorr

For Fortress: Morgan Chu of Irell & Manella

Read more:

Apple, Intel file antitrust case against SoftBank-owned firm over patent practices

DOJ backs prolific patent litigant in antitrust fight with Apple

Intel loses U.S. patent trial, ordered to pay $2.18 billion to VLSI Tech

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Blake Brittain

Thomson Reuters

Blake Brittain reports on intellectual property law, including patents, trademarks, copyrights and trade secrets. Reach him at blake.brittain@thomsonreuters.com

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