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Digital and Cyrix Sue Intel for Alleged Patent Infringement


In a dual challenge to computer chip powerhouse Intel Corp., Digital Equipment Corp. and Cyrix Corp. said separately Tuesday that they are suing Intel for using patented technology in its best-selling microprocessors.

The Digital Equipment suit, filed Monday in U.S. District Court in Massachusetts, accuses Intel of illegally using patented Digital technology to boost the performance of its popular line of microprocessors, including the Pentium and the just-released Pentium II.

The unrelated Cyrix suit, filed Tuesday in U.S. District Court in Texas, alleges that Intel products, including the Pentium, Pentium Pro and Pentium II microprocessors, infringe one or both of two patents issued to the Richardson, Texas-based company.

Both companies said they are seeking an injunction to force Intel to stop using the technology, as well as unspecified monetary damages.

Digital Chairman Robert Palmer said that "as a result of its infringement of our patents, Intel has strengthened its monopoly in the X86 market and is seeking to extend its monopoly to higher-performance microprocessors."

Maynard, Mass.-based Digital is a maker of high-performance computers used primarily by businesses. It also has its own high-end microprocessor family called the Alpha. Some of Digital's machines run on Intel chips.

The suit appeared to blindside Santa Clara, Calif.-based Intel, which supplies about 85% of the world's microprocessors and is both a longtime Digital customer and supplier.

Industry analysts were scratching their heads about the move by Digital, a 40-year-old company that generally avoids controversy and courtrooms. Analysts also said the suit involves serious risks.

"They've just signed up for a major drain on management time and resources," said Nathan Brookwood, an analyst at Dataquest in San Jose. "They'll spend a lot of money, and may very well end up with nothing to show for it."

Intel shares fell $6.75 to close at $152.375 on Nasdaq; Digital shares jumped $2.25 to close at $35.375 on the New York Stock Exchange. Cyrix shares eased 62.5 cents to close at $23 on Nasdaq.

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