On March 26 Nvidia announced that it had filed a countersuit against Intel, which on Feb. 16 filed a suit against Nvidia.
Intel claims Nvidia does not have the right to develop and manufacture chip sets for Intel processors based on Intel's "Nehalem" microarchitecture.
In 2004, the two signed an agreement allowing Nvidia to make compatible chip sets for Intel processors; Intel's position is that the latter did not cover processors based on Nehalem or future generations of microarchitecture-based processors.
Nvidia, however, does believe the agreement allows it to make chip sets for future generations of CPUs.
"We must defend ourselves and the rights we negotiated for when we provided Intel access to our valuable patents," said Jen-Hsun Huang, president and CEO of Nvidia, in a prepared statement.
"Intel's actions are intended to block us from making use of the very license rights that they agreed to provide."
Nehalem is built on Intel's second-generation 45-nanometer technology and offers speeds that have been the cause of much excitement.
Apple recently refreshed its iMac and Mac mini desktop lines with Intel Nehalem processors.
And at Dell's recent announcement of new blades, servers and workstations, executives were giddy with the prospects of Nehalem, announcing that just one of the company's Nehalem-based servers could replace nine single-core servers, and up to 18 servers with its virtualization technologies turned on, and that the servers would enable customers to recoup their costs in just eight months.
"Nehalem brings us here today!" said Steve Schuckenbrock, vice president of enterprise products, over the Dell Webcast. "It's a big step forward."
Nvidia has focused on improving graphics capabilities as a way of providing a faster, richer user experience. On March 25 it offered information about its new line of Quadro GPUs, or graphics processor units, which are dedicated graphics-rendering devices, as well as an SLI Multi-OS-though it delayed the official release until March 30, when Intel will also be releasing news.
Later this year, Intel is expected to launch a processor that combines the CPU and GPU on a single piece of silicon. It's also working on a 32-nanometer processor, code-named Westmere.
Under the Intel-Nvidia cross-license agreement, "Intel gets access to Nvidia's graphics technology for its embedded graphics, and Nvidia gets access to Intel's core logic IP, which allows it to make embedded graphics for Intel platforms," said Roger Kay, president of Endpoint Technologies, stating the case plainly.
"Intel says the agreement is out of date because the IP has changed as of Nehalem."
Intel and Nvidia both say they've tried to reach an agreement, without success. So now the decision is up to a state of Delaware court.
"However, the better outcome for the industry and the customers would be a reasonable settlement and a resumption of cross-licensing," said Kay.