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FTC Weighing Challenge Against Intel, Sources Say

April 29, 1998|From Bloomberg News

WASHINGTON — U.S. antitrust enforcers are considering a two-part legal challenge to Intel Corp.'s marketing practices, though no decision has been made on whether to bring a case, several people familiar with the probe told Bloomberg News.

The strategy would let the Federal Trade Commission move quickly to attack business practices criticized in a recent court decision against Intel, while also weighing a broader antitrust suit against the Santa Clara-based company.

Since September, the FTC has examined whether Intel withholds technology and information from rivals and uses its near-monopoly in the computer-chip industry to move into related markets, industry analysts and executives said.

"Intel has used its strength to dominate more of hardware design and content in the industry," said Scott Winkler, vice president of Gartner Group, a Stamford, Conn.-based consulting firm.

Two weeks ago, U.S. District Judge Edwin L. Nelson issued a preliminary injunction siding with Intergraph Corp., a computer maker based in Huntsville, Ala., that was denied sample chips and key technical information if it didn't give patent rights to Intel.

Intel has appealed the ruling and maintains it doesn't engage in unfair market practices.

"We've done nothing illegal in achieving our success," Intel spokesman Chuck Mulloy said. "We are cooperating fully with [FTC investigators] as they continue to conduct a nonpublic review."

He declined comment on specific allegations that could be brought against the company, and FTC spokeswoman Victoria Streitfeld refused to confirm or deny reports of the probe.

Intel shares fell 69 cents to close at $79.31 on Nasdaq.

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