Silicon Labs, TDK settle patent infringement lawsuit

By siliconindia   |   Thursday, 03 April 2003, 20:30 IST
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Silicon Laboratories Inc. (Nasdaq:SLAB) and TDK Semiconductor Corporation Thursday announced the settlement of a patent infringement lawsuit brought by TDK.

AUSTIN: Under the terms of the settlement, TDK agreed to release all claims covered by the lawsuit. In addition, TDK granted Silicon Laboratories irrevocable, royalty-free licenses for the patent covered by the lawsuit and certain other related patents. In exchange, Silicon Laboratories agreed to make a one-time payment of $17 million to TDK and released all counterclaims covered by the lawsuit. Silicon Laboratories and TDK agree that the amicable resolution of this litigation does not constitute an admission or concession of liability or fault by either party. All other terms of the settlement are confidential. "The resolution of this lawsuit, which has been pending for almost two years, will allow the management of Silicon Laboratories to focus time and energy on the continued growth of the company," said Russ Brennan, chief financial officer of Silicon Laboratories. "TDK Semiconductor Corporation is pleased to have resolved this litigation matter with terms and conditions that allow both parties to move forward with their business strategies," said Gerald Fitch, chief financial officer of TDK Semiconductor Corporation. The majority of the settlement payment will be expensed in Silicon Laboratories' first quarter with a $15.3 million charge to cost of revenues, resulting in approximately $0.20 per diluted share reduction to earnings. The remaining $1.7 million of the $17 million total payment will be amortized to cost of revenues over the useful life of the technology. Silicon Laboratories exited fiscal 2002 with a debt-free balance sheet and with cash, cash equivalents and short-term investments totaling $115.2 million.