Lawyers secure $2.3 billion judgment against Intel in one of the largest ever patent cases

Forced by a power failure amid a severe winter storm to dine on cold rolls in their Waco, Texas, hotel suite during a 2021 trial, co-lead attorney Morgan Chu and his Irell & Manella LLP team nevertheless secured a $2.3 billion final judgment for client VLSI Technology LLC.

"It was fun, as all trials are for me," Chu said, "but we lost power and internet contact intermittently and the hotel lost water. It was impossible to get food. We sent people out to forage and they came back with hot dog buns. We were inconvenienced, but we didn't suffer the way many did."

Top patent litigator Amy E. Proctor had a few cans of baked beans. Alan J. Heinrich, an IP veteran, had a fried chicken leg in his fridge. Benjamin W. Hattenbach, the co-lead attorney, shared a personal memory of "Wandering the completely deserted streets of Waco during a historic ice storm that delayed trial by a week."

Thus fueled, the team persuaded a jury that Intel infringed on the VLSI patents that save power and increase performance in Intel's microprocessors. Focusing on the real-world benefits Intel gained from using VLSI's patents was a major theme.

Hattenbach presented the inventor. "He explained the origins of the patented technology Intel incorporated into nearly one billion microprocessors."

The jury award, combined with more than $162 million in prejudgment interest, represented the largest patent score in U.S. history. Intel's appeal is pending at the U.S. Court of Appeals for the Federal Circuit.

At a second trial in 2022 against defendant Intel in Austin, Texas, regarding a microprocessor technology patent, the jury awarded $948 million.

The team recalled that Intel's defense included allegations of impropriety in VLSI's patent licensing operations. "But after the first trial, Intel did the same thing -- sold some of its patents to two licensing entities," Heinrich said.

At the second trial, Heinrich surprised an Intel witness, a leading engineer, with the news that Intel had indeed transferred two of his patents to a licensing company. "And you know, they never said sorry for accusing us," he said in mock outrage.

Some of the funds Irell obtained for VLSI will go to further research and development at the company that had originated the patents, NXP Semiconductors Inc. "More generally, the success of these cases will go to help companies to invest in technology and promote innovation," Proctor said.

Proctor said a highlight for her was having an Irell associate, one of her mentees, examine a key witness just before Proctor herself examined a second.

That illustrated the strength of the Irell team, Chu said. "They worked together through thick and thin, and they were able to modify our strategy for each trial as underlying developments changed."

- JOHN ROEMER