Intel Wins Court Ruling in Antitrust Case

 
 
By Jeffrey Burt  |  Posted 2010-07-30
 
 
 

Intel got a rare win in court when a special master in a case filed by consumers ruled that he had found no evidence that consumers had been hurt by the giant chip maker's business practice of giving discounts to computer makers.

Special Master Vincent Poppiti, ruling on the case, which was filed in U.S. District Court in Delaware, rejected a motion that would have allowed the case to go forward as a class-action lawsuit.

In his 112-page ruling made July 28, Poppiti said that while Intel may have given discounts and rebates to PC makers in hopes of persuading the OEMs to limit the use of chips from rival Advanced Micro Devices, there was no evidence that consumers were harmed by the action.

He ruled that the systems makers had the discretion in how they used that money and that some had used the money to help lower the prices of some of their products.

Intel has been besieged by complaints and lawsuits filed by regulatory bodies over what the agencies say were business practices designed to unfairly hinder competition from AMD. Regulators claim that Intel used incentives, including discounts and rebates, as well as threats, to influence OEMs like Dell, Hewlett-Packard and IBM to limit their use of AMD products in their systems.

The chip maker was fined by the European Union last year for $1.45 billion, a fine that Intel is appealing. The company also faces lawsuits filed by the N.Y. Attorney General's Office and the Federal Trade Commission. Intel and the FTC are in negotiations to settle that case.

In addition, Intel also settled its legal disputes with AMD in December in an agreement that included a $1.25 billion payment to its smaller rival. Intel also is being sued by graphics chip maker Nvidia.

Throughout all this, Intel executives have claimed that while the company has been aggressive in its business practices, it has not acted unfairly or violated antitrust laws. They also have argued that consumers have benefited from the company's discounts.

Plaintiffs in the case before Poppiti were seeking class-action status, claiming that consumers were harmed by these practices.

However, Poppiti dismissed that claim, saying that the fact that some OEMs passed savings on to consumers showed that there was no "common impact" resulting from Intel's business practices. He also called an expert witness for the plaintiffs unreliable.

The plaintiffs have 21 days to object to Poppiti's ruling. A lawyer for the plaintiffs has said he plans to file an appeal.

 


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