US tech group Rambus, EU close in on anti-trust settlement

(BRUSSELS) - US technology licensing company Rambus has offered to cap some computer chip technology royalties to settle an antitrust case with EU regulators, the two sides said on Friday.

In July 2007, the European Commission filed formal antitrust charges against Rambus alleging that the company had charged unreasonably high royalty rates on patents for some its computer chip technology.

The case covers patents for Dynamic Random Access Memory (DRAM) chips which are a type of electronic memory primarily used in computer systems, but also in a wide range of other products including printers and cameras.

Because Rambus owns the patents for the industry-standard DRAM technology, the commission -- Europe's top competition watchdog -- claims manufacturers must either get a licence from the company or fight the patents in court.

The commission also accused Rambus of engaging in "intentional deceptive conduct in the context of the standard-setting process".

After the commission accused Rambus of abusing its stranglehold on the industry standard by demanding exorbitant royalties, the company committed to cap its rates for five years.

"With this proposed resolution, we create a new platform where all parties can move forward by licensing our patented innovations for future use in their products rather than engaging in costly litigation," Rambus general counsel Thomas Lavelle said in a statement.

The commission said it was now seeking comments on the arrangement from third parties in line with EU rules before deciding whether it could serve as a final settlement of the case.

Without a settlement, Rambus could face fines equivalent to 10 percent of its annual global turnover under EU antitrust rules.