Rambus Chips Away at Samsung Suit

RambusRMBS shares spiked Wednesday in response to a court filing seeking a dismissal of litigation in Virginia against vs. Samsung, the world's second-largest chipmaker and the largest memory manufacturer.

But there may be more to come.

Rambus requested that a Virginia federal district court dismiss a Samsung lawsuit, in part because it had signed a covenant agreeing not to sue Samsung for infringement on four patents. Rambus asked that Samsung's claims be dismissed, as well as its counterclaims against Samsung.

The dismissal request would pertain only to the Virginia case and the covenant not to sue pertains only to products made up until now. It does not cover future products.

Rambus has a pending case in against Samsung in California, and Samsung has a case against Rambus in Delaware Chancery court. Rambus also has sued Samsung as part of an antitrust suit against several memory chipmakers, including Micron Technology MU and Hynix Semiconductor.

The Virginia court filing was posted to Rambus' Web site on Tuesday afternoon. Rambus shares rose 7% to $11.84 in midday trading Wednesday, but shares didn't pop until 30 minutes into the trading session. A Rambus spokeswoman declined to comment.

The case goes back to June 6 when Rambus sued Samsung in California, and Samsung countersued Rambus in Virginia.

Los Altos, Calif.-based Rambus designs memory interfaces for microchips which it then licenses out to chipmakers. The company took action in June against Samsung after negotiations broke down on an existing licensing agreement that centered on SDRAM and DDR, two types of electronic memory. That license expired on June 30 and was terminated.

Investors may be interpreting the signed covenant not to sue as a prelude to some sort of agreement between Samsung and Rambus. Since the agreement and request only cover the Virginia case, however, Rambus might just see this as its only way to get out of the Virginia court room, which has long been viewed as an unfriendly venue for Rambus.