Motorola sues Intel

Motorola's Semiconductor Products Sector group filed suit against Intel on Thursday, alleging misappropriation of trade secrets following the hiring of a former Motorola executive by Intel.

In a suit filed in the State District Court in Austin, Texas, Motorola alleged that Intel gained access to Motorola trade secrets following the hiring of Mark McDermott, who was previously the director of Motorola's Somerset Design Centre in Austin.

Intel hired McDermott last September to head up its newly created Texas Development Centre, also located in Austin, according to Ken Phillips, director of business communications for Motorola's Semiconductor Products Sector.

"At that point there began a concerted predatory targeting of key designers from (Motorola's) Somerset Design Centre," Phillips said.

An Intel spokesman said that Intel had not done anything wrong.

"We deny that we improperly recruited employees from Mototorla," said Intel's Chuck Mulloy, reading from a statement that was the company's only comment on the suit. "We plan to vigorously defend ourselves."

But the lawsuit maintains that at least 15 Motorola employees were hired to work at Intel's new Austin facility, bringing with them knowledge of Motorola's fundamental technology from the Somerset Design Centre, where Motorola develops the PowerPC chips it makes for use in Apple Computer's Macintosh computers, according to Phillips. Motorola was particularly concerned with keeping secret the designs for PowerPC chips, he said.

"Chip for chip, a PowerPC consumes 80 percent less power and is one-third the size of the standard Intel chip," Phillips maintained.

Motorola's attempts to settle the matter with Intel out of court were unsuccessful, so the company decided to pursue the issue in court, Phillips said. Motorola is seeking damages, including potentially punitive and compensatory damages, though under Texas law the company doesn't have to set those down in its initial filing, he said.

The case now goes to a discovery period, which is typically between 60 and 90 days, followed by a hearing on the injunction. Depending on the outcome of the hearing, it could go to trial, Phillips said.

Until the middle of last year, Motorola and IBM were operating the Somerset PC chip design centre together, then Motorola bought IBM out of the partnership.

Motorola's legal move against Intel comes hard on the heels of the US Federal Trade Commission (FTC) settling its antitrust suit against Intel last Monday which related to the withholding of technical information from a trio of the company's customers -- Compaq Computer, Digital Equipment (now owned by Compaq) and Intergraph.

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