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Broadcom Wins Tentative Ban on Infringing Emulex Products

Broadcom Corp. (BRCM) won a tentative ruling prohibiting rival chipmaker Emulex Corp. (ELX) from selling so- called controller chips for communications networks that were found to infringe two Broadcom patents.

U.S. District Judge James Selna in Santa Ana, California, issued a tentative decision before a hearing today on Broadcom’s request for a permanent injunction. The judge said he would allow Emulex to sell the infringing products for another 18 months to existing customers who have ordered them, while paying Broadcom a 3 percent royalty.

At the hearing, Selna said he would issue a final ruling on Broadcom’s request next week.

The judge had found last year that Emulex infringed two of Irvine, California-based Broadcom’s patents. Emulex, based in Costa Mesa, California, objected to a court-ordered ban of sales of infringing products and asked for a mandatory royalty instead.

Juanita Brooks, a lawyer for Emulex, said at today’s hearing that “incredible market disruptions” would occur if the judge would enter an injunction. She asked Selna to “not carve it out in such a way so the public should suffer because of a war between Broadcom and Emulex.”

Bill Lee, a lawyer for Broadcom, asked the judge to triple the royalty rate Emulex will have to pay Broadcom during the 18- month “sunset” period.

The case is Emulex v. Broadcom, 09-01310, U.S. District Court, Central District of California (Santa Ana).

To contact the reporter on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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