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Judge Rules Rambus Destroyed Evidence, Rejects FTC Bid

March 06, 2003|From Reuters

A judge has ruled that Los Altos, Calif., chip designer Rambus Inc. intentionally destroyed documents relevant to the government's antitrust case against it, the Federal Trade Commission disclosed Wednesday.

However, Administrative Law Judge James Timony denied an FTC request to assess penalties without holding a trial.

Both rulings were handed down last week.

Timony said Rambus must prove its innocence on allegations that the firm improperly patented chip technologies.

Timony said the sanctions were needed because of "Rambus' intentional destruction of documents that it knew or should have known were relevant to reasonably foreseeable litigation," he added.

Shares of Rambus on Wednesday closed down $1.65 to $13.78 on Nasdaq.

The FTC in August filed antitrust charges against Rambus, contending that the firm participated for more than four years in an industry standard-setting group without disclosing it had a patent and several pending patent applications for technologies ultimately adopted by the group.

The FTC argued that Rambus forfeited its right to a trial because it had destroyed potentially incriminating documents. Timony said that "drastic" request seemed "unjustified."

"However, it is clear that Rambus should not be rewarded for its gross negligence concerning or reckless disregard of its obligation to maintain documents," the judge said. Rambus said the destruction was part of its document retention policy.

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