Broadcom says Emulex is using its patented technology unlawfully and is off to court to stop Emulex using unlicensed technology and to get cash damages.
Terrific. If you can't buy a company then smack it with a law suit. Broadcom even has a VP for this area, David Rosmann, in charge of intellectual property litigation, who says: "As we developed our plans for the Fibre Channel over Ethernet market, we discovered that Emulex is infringing multiple Broadcom patents in an effort to use Broadcom technology to compete against both our existing and future products."
Broadcom was all over Emulex earlier this year in its rebuffed acquisition attempt and relationships between the two companies soured.
Ten patents are cited in the suit, covering integrated circuit design, serializer/deserializer (SerDes), TCP offload engine (TOE), remote direct memory access (RDMA), Fibre Channel, and Fibre Channel over Ethernet technologies. Broadcom has a portfolio of 3,000 plus patents.
Stifel Nicolaus analyst Aaron Rakers said: "In our opinion, this is clearly a reaction from Broadcom to Emulex's rebuffing of the company's attempts to acquire earlier this year – cannot buy them, then sue them."
"Broadcom's aggressiveness and recent success in winning a patent infringement suit against Qualcomm (four year process; outcome was approximately $891 million ruling in Broadcom's favor) and others, we view this as a negative for Emulex." Rakers doesn't think the suit is a precursor to another takeover attempt. Instead Broadcom will develop its own internal Fibre Channel over Ethernet (FCoE) technology.
QLogic might be another Broadcom IP licensing target but Broadcom told Rakers it had not looked at QLogic's product technologies from that point of view.
Emulex said it "is reviewing the patents associated with the complaint filed today by Broadcom. Emulex has a policy of vigorously defending the company against assertions of this kind. Due to the pending litigation, we are unable to comment further." ®: