How Getting Sued By Harvard Might Affect Micron

Jul 18, 2016

Credit Dan Greenwood / Boise State Public Radio

We learned last week that Harvard University is suing Micron Technology over patent infringement. Micron isn’t commenting on the suit. If it goes to court, the company will likely argue that the technology it uses is based on a patent it owns, not the one developed by Harvard.

Jim Feldhan says companies like Micron have portfolios of patents they call their war chests. Feldhan is president of Semico Research, a semiconductor industry consulting firm. He says the company will pull patents out of its war chest and hope one of them is older or relates more directly to what it’s doing than Harvard’s.

The technology in this particular lawsuit is used to create thin insulating layers in memory chips. We won’t try to parse the merits of the case. But we do want to know what this suit could mean for one of Idaho’s largest employers. So, what if Micron loses?

Feldhan says it could mean paying Harvard a little money or a lot. He says the amount of the payout would depend on how important the judge thinks the technology is to what Micron makes. If the judge says Micron violated Harvard’s patent, the company would then have to argue that the technology is not all that important.

Imagine you owned the patent for steel. You could sue Ford or GM for a huge amount because they could not have made anything in their history without steel. Feldhan says the technology at issue is important to Micron but definitely not as important as steel in making a car. He says it’s one of more than 300 steps in making a chip.

“Is it worth one-300th of the value of the product? That’s what someone might argue,” Feldhan says. “The other side of the coin is, ‘well without this technology you couldn’t make the product, so you know it should be worth … 20 percent of the product.’”

But Feldhan says companies in the semiconductor industry operate on very thin margins, so even a relatively small payout could be a big hit to Micron. That’s one of the reasons he says, cases like this tend to stay in court for many years, as both sides wait for the other to give up. 

Find Adam Cotterell on Twitter @cotterelladam

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