PUBLIC VERSION

UNITED STATES INTERNATIONAL TRADE COMMISSION Washington, D.C. Before The Honorable Theodore R. Essex Administrative Law Judge

In the Matter of CERTAIN SEMICONDUCTOR CHIPS AND PRODUCTS CONTAINING SAME Inv. No. 337-TA-753

COMBINED RESPONSE OF THE COMMISSION INVESTIGATIVE STAFF TO: (1) COMPLAINANT RAMBUSS MOTION FOR SUMMARY DETERMINATION ON RESPONDENTS AFFIRMATIVE DEFENSES BASED ON STANDARD-SETTING ORGANIZATIONS (MTN. DKT. NO. 753-030); AND RESPONDENT BROADCOMS MOTION FOR LEAVE TO FILE A REPLY IN SUPPORT OF ITS MOTION TO TERMINATE WITH RESPECT TO THE DALLY PATENTS (MTN. DKT. NO. 753-034)

(2)

OFFICE OF UNFAIR IMPORT INVESTIGATIONS Lynn I. Levine, Director David O. Lloyd, Supervisory Attorney Daniel L. Girdwood, Investigative Attorney U.S. International Trade Commission 500 E Street, S.W. Suite 401-H Washington, D.C. 20436 202.205.3409 (ph) 202.205.2158 (fax) Confidential Version: Public Version: July 18, 2011 July 26, 2011

1 I. INTRODUCTION The Commission Investigative Staff (Staff) hereby provides its combined response to two motions that relate to Complainant Rambus, Inc.s (Rambus) participation in various standard-setting organizations (SSO). On June 30, 2011 Rambus filed a motion for summary determination (Mtn. Dkt. No. 753-030) on the Respondents affirmative defenses that are based on Rambuss SSO participation. On July 5, 2011, Respondent Broadcom Corporation (Broadcom) filed a motion for leave to file a reply (Mtn. Dkt. No. 753-034) in support of its prior motion for partial termination of the investigation (Mtn. Dkt. No. 753-021) on the grounds that injunctive relief as to the Dally patent family is precluded by obligations arising out of a Rambus predecessors SSO participation.1 As discussed more fully below, the Staff is of the view that there is no genuine issue of material fact in dispute as to the obligations (or lack thereof) arising out of Rambuss SSO participation. Because Rambuss SSO participation does not preclude the relief sought in this investigation as alleged in the Respondents SSO-based affirmative defenses, the Staff supports the Rambus Motion for summary determination and disagrees with contrary allegations made by Broadcom in its Proposed Reply. The Staff further submits that Broadcom has failed to show good cause for filing the Proposed Reply, which focuses largely on facts, cases, and legal issues that should have been addressed in its initial motion for partial termination. The Staff therefore opposes Broadcoms motion for leave to file its Proposed Reply.

For purposes of this combined response, the memorandum in support of Mtn Dkt No. 753-030 will be referred to as the Rambus Motion and the proposed reply attached as an exhibit to Mtn Dkt No. 753-034 will be referred to as the Proposed Reply. PUBLIC VERSION

2 II. LEGAL STANDARDS A. Summary Determination

Pursuant to Rule 210.18(b), a party is entitled to summary determination if pleadings and any depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a summary determination as a matter of law. 19 C.F.R. 210.18(b). The Judge recently explained the standard as follows: The evidence must be viewed in the light most favorable to the party opposing the motion with doubt resolved in favor of the nonmovant. Issues of fact are genuine only if the evidence is such that a reasonable fact finder could return a verdict for the nonmoving party. The trier of fact should assure itself that there is no reasonable version of the facts, on the summary judgment record, whereby the nonmovant could prevail, recognizing that the purpose of summary judgment is not to deprive a litigant of a fair hearing, but to avoid an unnecessary trial. Where an issue as to a material fact cannot be resolved without observation of the demeanor of witnesses in order to evaluate their credibility, summary judgment is not appropriate. In other words, summary judgment is authorized when it is quite clear what the truth is . . . and the law requires judgment in favor of the movant based upon facts not in genuine dispute. Certain Hybrid Electric Vehicles and Components Thereof, Inv. No. 337-TA-688, Order No. 12 at 3 (May 21, 2010) (internal quotes and citations omitted). B. Leave to File a Reply

Under Rule 210.15(c), [t]he moving party shall have no right to reply, except as permitted by the administrative law judge or the Commission. 19 C.F.R. 210.15(c). The presiding Judge permits a moving party to reply only to the extent that the proposed reply complies with Ground Rule 3.6, which states [a] reply to responses and sur-replies may be made if the replying party so moves (with the reply and/or surreply attached thereto) and states specific reasons why a reply is needed (not merely reargument). In other words, the moving party must show good cause for filing a reply. See, e.g., Certain Composite Wear Components PUBLIC VERSION

3 and Products Containing Same, Inv. No. 337-TA-644, 2009 ITC LEXIS 149, at *1 (Feb. 3, 2009) (granting a motion for leave to file a reply based on a showing of good cause). III. DISCUSSION The instant motions involve alleged obligations arising out of participation by Rambus or a Rambus predecessor in two distinct SSOs: (1) the Joint Electron Device Engineering Council (JEDEC); and (2) the Peripheral Component Interconnect Special Interest Group (PCI-SIG). The alleged JEDEC obligations differ in significant respects from those that relate to PCI-SIG. As such, the Staff addresses the alleged JEDEC and PCI-SIG obligations individually below, starting first with JEDEC. A. Summary Determination Denying Respondents JEDEC Defenses is Warranted (1) Background

Rambus seeks a summary determination on affirmative defenses based on its JEDEC participation, including defenses of estoppel, acquiescence, waiver, and licensing. See Rambus Motion at 1, 15-17. In so moving, Rambus correctly notes that this is not the first time a JEDECbased defense has been raised with respect to the patents asserted in this investigation. See id. at 1-2. In the 661 investigation, the presiding Judge rejected virtually identical allegations that Rambus was equitably estopped from asserting the Barth I patents due to a purported failure by Rambus to meet its duty to disclose patents and patent applications to JEDEC. See Certain Semiconductor Chips Having Synchronous Dynamic Random Access Memory Controllers and Products Containing Same, Inv. No. 337-TA-661, Initial Determination at 118 (Jan. 22, 2010), unreviewed in pertinent part 75 Fed. Reg. 16507-09 (Apr. 1, 2010) (661 ID). Virtually identical defenses were also raised, and rejected, in two Federal Circuit appeals in which the Court held that Rambus did not have a duty to disclose other patents and patent applications PUBLIC VERSION

4 (i.e., patents and patent applications that were not asserted in the 661 investigation) to JEDEC. See Rambus Inc. v. Infineon Techs. AG, 318 F.3d 1081, 1096-1105 (Fed. Cir. 2003) (Infineon); Hynix Semiconductor Inc. v. Rambus Inc., --- F.3d ---, 2011 U.S. App. LEXIS 9728, at 24-30 (Fed. Cir. May 13, 2011) (Hynix). Thus, to prevail on their JEDEC-based defenses, the Respondents will have to overcome the holdings of three prior cases that addressed virtually identical facts involving virtually identical allegations namely, whether Rambus violated a duty to disclose its patents and patent applications to JEDEC. (2) Respondents JEDEC-Based Affirmative Defenses Should Be Rejected

The Staff supports summary determination based on the apparent lack of any new, relevant evidence to suggest that the presiding Judge, the Commission, and the Federal Circuit incorrectly rejected virtually identical allegations in the 661 investigation, in Infineon, and in Hynix. As the Federal Circuit has explained: Rambuss duty to disclose extended only to claims in patents or applications that reasonably might be necessary to practice the standard. In other words, this duty encompassed any patent or application with claims that a competitor or other JEDEC member reasonably would construe to cover the standardized technology. This does not require a formal infringement analysis. Members are not required to perform a limitation-by-limitation comparison or conduct an equivalents analysis. Rather, the disclosure duty operates when a reasonable competitor would not expect to practice the standard without a license under the undisclosed claims. Stated another way, there must be some reasonable expectation that a license is needed to implement the standard. By the same token, the disclosure duty does not arise for a claim that recites individual limitations directed to a feature of the JEDEC standard as long as that claim also includes limitations not needed to practice the standard. This is so because the claim could not reasonably be read to cover the standard or require a license to practice the standard. Infineon, 318 F.3d at 1100-01 (emphasis added). Applying this standard to the evidence before the court, the Federal Circuit has twice found that Rambus did not have a duty to disclose its patents or patent applications to JEDEC. See id. at 1096-1105; Hynix, 2011 U.S. App. LEXIS

PUBLIC VERSION

5 9728, at *24-30. No new, relevant evidence is expected to be introduced in this investigation as to the Respondents JEDEC-based defenses. Indeed, the evidence necessary to demonstrate the violation of such a duty -- i.e., Rambuss pending patents and patent applications (which are available from the U.S. Patent & Trademark Office), JEDECs patent disclosure policy and associated bylaws (which are available from JEDEC and discussed in detail in Infineon itself), and technical details regarding JEDEC standards that had issued or were under formal consideration at the time of Rambuss membership (which are available from JEDEC and to some extent discussed in Infineon itself), etc. -- was considered and rejected as inadequate by the presiding Judge in the 661 ID and by the Federal Circuit in both Infineon and Hynix. See 661 ID at 116-18; Infineon, 318 F.3d at 1096-1105; Hynix, 2011 U.S. App. LEXIS 9728, at *24-30. To the extent that the Respondents argue they can prove a violation of a disclosure duty by showing that, long after departing JEDEC, Rambus eventually obtained claims which contain some limitations that appear in current JEDEC standards, the Staff disagrees. As the Federal Circuit explained in Infineon, that is not sufficient to trigger JEDECs patent disclosure policy, which focuses on Rambuss then-pending claims and JEDECs then-pending standards i.e., at the time of Rambuss membership. See Infineon, 318 F.3d at 1100-01. To the extent that the Respondents argue their ability to prove a violation of a disclosure duty was impaired by Rambuss spoliation of evidence, the Staff disagrees. Again, in Infineon the Federal Circuit identified the materials necessary to determine whether Rambus violated a JEDEC disclosure duty as outlined above. See Infineon, 318 F.3d at 1100-01. These materials undisputedly still exist and have been made available to the Respondents.

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6 Given the above, the Staff respectfully submits that a summary determination rejecting the Respondents JEDEC-based defenses is warranted under the reasoning set forth in the 661 ID, Infineon, and Hynix. The Staff thus supports Rambuss Motion in this regard. B. Respondents PCI-SIG Defenses And Associated Motion For Leave to File a Reply Should be Rejected (1) Background

On May 26, 2011, Broadcom filed a motion (Mtn. Dkt. No. 753-021) directed at Rambuss ability to seek injunctive relief with respect to the Dally patent family, which includes U.S. Patent Nos. 7,715,494; 7,602,858; and 7,602,857. See Complaint, 103-17. According to Broadcom, Rambus is contractually bound to license the asserted Dally patents on fair, reasonable, and non-discriminatory (FRAND or RAND) terms due to the participation of a Rambus predecessor-in-interest to the Dally patents in the SSO that promulgated the PCI Express standard. Because the Commission cannot award monetary relief or order a compulsory license on FRAND terms pursuant to Rambuss purported FRAND obligations, Broadcom is of the view that the Commission lacks jurisdiction to conduct a Section 337 investigation as to the asserted Dally patents. Broadcom thus moved to terminate the investigation as to the Dally patent family on this basis.2

Broadcoms motion was ultimately joined by nVidia and Cisco, and largely supported by an amicus curiae brief filed by PCI-SIG. See Respondent nVidia Corp.s Unopposed Motion for Leave to File June 7, 2011 Notice of Joinder to Respondent Broadcoms Motion to Terminate with Respect to the Dally Patents, Mtn. Dkt. No. 753-026 (June 10, 2011); Respondent Cisco Systems Inc.s Unopposed Motion for Leave to File Notice of Joinder to Respondent Broadcoms Motion to Terminate with Respect to the Dally Patents, Mtn. Dkt. No. 753-027 (June 13, 2011); Motion of PCI-SIG for Leave to File a Brief Amicus Curiae in Support of no Party, Regarding Respondent Broadcoms Motion to Terminate with Respect to the Dally Patents, Mtn. Dkt. No. 753-029 (June 23, 2011). PUBLIC VERSION

7 On June 17 and 20, 2011 respectively, the Staff and Rambus filed oppositions to Broadcoms motion.3 Both the Staff and Rambus noted Broadcoms failure to address a key provision of the PCI-SIG bylaws that expressly excludes from the FRAND obligations therein patents on which the grant of license would require payment to a third party. See Staff Opposition at 7-9; Rambus Opposition at 16-20. Broadcom was aware of or should have been aware of the third party payment issue when it filed its motion to terminate as the issue was discussed in briefing associated with a prior summary determination motion.4 Both the Staff and Rambus further noted Broadcoms failure to identify the position of its co-Respondent Motorola in accordance with Ground Rule 3.2, and Broadcoms failure to cite directly contrary Motorola precedent that counsel for Broadcom, who had represented Motorola in those proceedings, was aware of when the motion to terminate was filed. See Exhibits 1 and 2 to Staff Opposition; Staff Opposition at 3-4, 9-15; Rambus Opposition at 15-16. On June 30, 2011, Rambus filed one of the two motions addressed herein (i.e., Mtn. Dkt. No. 753-030), in which Rambus seeks a summary determination on the Respondents affirmative defenses that implicate the PCI-SIG issues previously noted in Broadcoms motion to terminate and the oppositions thereto. On July 5, 2011, Broadcom filed another of the motions addressed herein (i.e., Mtn. Dkt. No. 753-034), in which Broadcom seeks leave to respond to the

See Opposition of the Commission Investigative Staff to Respondent Broadcoms Motion to Terminate with Respect to the Dally Patents, EDIS Doc. ID 452827 (June 17, 2011) (Staff Opposition); Rambus Inc.s Opposition to Broadcoms Motion to Terminate with Respect to the Dally Patents, EDIS Doc. ID. 452955 (June 20, 2011) (Rambus Opposition). See Rambus Inc.s Opposition to Motion by Freescale Semiconductor Inc. for Summary Determination that Freescales Products Accused of Infringing the Dally Patents are Licensed by Rambus, EDIS Doc. ID 450904 at 25-26 (May 16, 2011) (discussing evidence of royalties owed to MIT for licenses to the Dally patents). PUBLIC VERSION
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8 oppositions of Rambus and the Staff to Broadcoms motion for partial termination (i.e., Mtn. Dkt. No. 753-21). The Staff responds below. (2) Broadcom Lacks Good Cause for Filing a Reply Addressing Issues That Counsel Knew or Should Have Known About Prior to Filing its Motion to Terminate

The Staff respectfully submits that Broadcom has failed to show good cause for filing its Proposed Reply. In this respect, the Staff notes that Broadcom has not focused solely on case law that issued after the filing of Broadcoms motion to terminate on May 26, 2011 and that could not have been addressed therein. Such precedent was attached as Exhibits 7-9 to the Staff Opposition. Instead, the Proposed Reply goes beyond addressing such precedent and improperly reargues issues that were addressed or that should have been addressed in the motion to terminate. See Ground Rule 3.6 (allowing a moving party to file replies upon a showing of good cause). The Staff therefore opposes the motion for leave. More specifically, Broadcom seeks leave to address for the first time the third-party payment issue that counsel knew or should have known about when filing the motion to terminate. See Proposed Reply at 11-13. Further, Broadcom seeks leave to address for the first time contrary Motorola precedent that counsel again knew or should have known about when filing the motion to terminate. See id. at 8. This belated argument is particularly troublesome given Motorola is a named Respondent in this investigation, Motorola was represented by Broadcoms counsel Quinn Emanuel in the proceedings Broadcom seeks leave to address, and Motorolas position was omitted in Broadcoms motion to terminate despite the requirement of Ground Rule 3.2 that the positions of all parties be identified. See Exhibit 3 to Staff Opposition (correspondence from counsel for Motorola confirming that Motorola was not consulted by Broadcom prior to motion filing); Order No. 31 (July 11, 2011) (rejecting Respondent Hitachis

PUBLIC VERSION

9 motion for an extension of time to accommodate third party discovery due to a failure to comply with Ground Rule 3.2). Finally, Broadcom seeks leave to address four year old district court precedent that again could have been addressed in the motion to terminate. See Proposed Reply at 8-10. In the Staffs view, good cause does not exist for Broadcom to belatedly address such issues by way of its Proposed Reply. The Staff thus opposes the motion for leave for at least these reasons. (3) Broadcoms Proposed Reply is Misleading

The Staff further submits that the Proposed Reply purportedly responds to arguments that were not, in fact, ever made, and contains numerous misstatements or misrepresentations. For example, the following statements appear on page 5 of the Proposed Reply: According to the Staff, the patent owner need only make some-any-offer to license the patents at issue. (emphasis in original) [U]nder . . . the Staffs interpretation of the FRAND agreement, a patent owner would have nothing to lose in offering an unfair, unreasonable, and/or discriminatory license and then filing a complaint with the Commission.

No such argument or interpretation was ever proposed by the Staff. Rather, the Staff Opposition repeatedly stated the exact opposite i.e., that injunctive relief often remains available if the patent holder has made good faith efforts to license the patent-at-issue on FRAND terms.5 Patent

See Staff Opposition at 10-11 ([D]espite Broadcoms assertions to the contrary, the plain language of Section 15.3 of the PCI-SIG bylaws merely requires members to engage in good faith efforts to license necessary claims on FRAND terms.); id. at 11 (District Court and Commission precedent confirm that injunctive relief often remains available if a patentee has engaged in good faith efforts to license standards essential patents on FRAND terms.); id. at 12 (In other words, FRAND obligations may require nothing more than a good faith attempt to license the asserted patents on FRAND terms. When an alleged infringer has rejected such a license offer, injunctive relief remains available. Commission precedent similarly suggests that relief at least remains available if a patentee has engaged in good faith efforts to license PUBLIC VERSION

10 holders are held to these requirements through the adversarial process (i.e., due to respondents ability to raise appropriate affirmative defenses) and through Commission Rules prohibiting frivolous filings (e.g., a complainant lacking a valid basis for asserting that its FRAND obligations have been met). Indeed, longstanding Commission precedent and recent district court precedent supports the Staffs view in this regard. See Staff Opposition at 9-15 (summarizing relevant Commission and district court precedent). On a related point, Broadcom states on page 7 of its Proposed Reply that the Staff essentially ignored the Microsoft case which is instructive, deserves more discussion, and contradicts the basic premise of Rambus and the Staffs oppositions to the motion to terminate. See Microsoft Corp. v. Motorola, Inc., Case No. C10-1823 JLR (W.D. Wash. June 1, 2011). To the contrary, the Staff did not ignore the Microsoft case. The Staff cited the relevant district court opinion and included as Exhibit 8 to the Staff Opposition a full copy of that opinion. Broadcoms assertions to the contrary are false. More importantly, the Staff Opposition accurately described the Microsoft case as discussing contractual obligations with SSOs that may give rise to FRAND obligations. See Staff Opposition at 8. This is a complete and accurate description of the Microsoft case -the court refused to dismiss Microsofts breach of contract claim which, as pled, argued that Motorola had failed to meet its obligation to license in good faith its standards-essential patents on FRAND terms. See Microsoft, slip op. at 5 (These factual allegations are sufficient to state a claim for breach of contract.). Broadcom conflates the dispute at issue in Microsoft by arguing

standards-essential patents on FRAND terms and the alleged infringer has refused to accept such a license.); id. at 14 ([T]he complainants contractual obligations simply required a good faith effort to license the asserted patent before the complainant could obtain such relief at the Commission.). PUBLIC VERSION

11 that the court would have dismissed the breach of contract claim if Rambus and the Staff were correct that a party subject to a FRAND agreement can satisfy its FRAND obligations and seek an injunction simply by making a licensing offer . . . . See Proposed Reply at 8. Again, the Staff has never made such an argument. Rather, the Staff has consistently stated its view that the patent holder typically must engage in good faith efforts to license its patent on FRAND terms. An unfair, unreasonable, discriminatory offer will not suffice and thus could potentially lead to a breach of contract claim. Broadcom further mischaracterizes the Microsoft case by arguing that the statement in the opinion that the court would have to determine the FRAND royalty for purposes of the damages analysis in the patent case necessarily reflect[s] the judges assumption that injunctive relief would not be granted for the patentee. See Proposed Reply at 8 n. 5. To the contrary, past damages may be awarded in addition to injunctive relief. See Verizon Servs. Corp. v. Vonage Holdings Corp., 503 F.3d 1295, 1309-11 (Fed. Cir. 2007) (noting that the district court had awarded damages and issued an injunction after infringement was found). Thus, the opinions reference to a yet-to-be-conducted damages calculation does not address or otherwise provide any guidance on whether injunctive relief is, or is not, available for infringement of a patent that may, or may not, be subject to FRAND obligations. In other words, the Staff Opposition correctly viewed the Microsoft case as largely irrelevant to the issues presented by way of Broadcoms motion to terminate. Finally, Broadcom misleadingly states on page 4 of its Proposed Reply that there are no instances of which Broadcom is aware where a respondent filed a motion to terminate based on a FRAND agreement. The Staff Opposition block quotes language from Order No. 21 in the 577

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12 investigation wherein the Chief Judge expressly noted that the respondent there had requested that this investigation be terminated due to the complainants purported FRAND obligations: Broadcoms Motion to Terminate That contractual obligation is legally inconsistent with the exclusionary relief that Rambus is now seeking, and requires dismissal of Rambuss claims for infringement. Motion at 1-2. Wireless Commn Equip., Order No. 21 Respondents further submitted that this investigation should be terminated with respect to the aforementioned patents because the right to such license is inconsistent with and precludes a grant of the exclusionary remedies sought by complainants. Order No. 21 at 1-2.

See Staff Opposition at 15. Notably, the underlying motion at issue in Order No. 21 was entitled a Motion for Partial Summary Determination and Partial Termination and thus encompassed the exact same relief that Broadcom now seeks by way of its similarly titled motion to terminate.6 Further, the attorney that filed the complainants opposition to the motion for partial termination in the 577 investigation is the same attorney who filed Broadcoms motion for leave to submit a Proposed Reply in support of termination in this investigation.7 In short, Broadcom was aware of a prior, unsuccessful attempt to terminate an investigation based on purported FRAND obligations despite statements to the contrary in its Proposed Reply. For these additional reasons, the Staff submits that Broadcoms motion for leave should be rejected.

See Certain Wireless Communication Equipment, Articles Therein, and Products Containing the Same, Respondents Motion for Partial Summary Determination and Partial Termination with Respect to Samsungs Declared Essential Patents, Mtn. Dkt. No. 577-027, EDIS Doc. ID 268366 (Jan. 19, 2007). While complainants opposition in the 577 investigation contains CBI and is thus not available to the parties in this investigation, the parties do have access to the document information summarized on EDIS which includes the title and filing attorney. See Certain Wireless Communication Equipment, Articles Therein, and Products Containing the Same, Samsungs Opposition to Respondents Motion for Partial Summary Determination with Respect to Samsungs Declared Essential Patents, EDIS Doc. ID 268939 (Jan. 31, 2007). PUBLIC VERSION
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13 (4) Summary Determination Denying Respondents PCI-SIG Defenses is Warranted

Turning to the merits of the PCI-SIG defenses, Rambus seeks a summary determination on any affirmative defense that relates to the Rambus predecessors participation in PCI-SIG. See Rambus Motion at 17-19. The Staff assumes that the Rambus Motion would encompass the breach of contract defenses certain Respondents are presently seeking to add by way of their pending motions for leave to file amended answers. See, e.g., Mtn. Dkt. Nos. 753-041; 753-035; 753-032. For reasons discussed more fully in the Staff Opposition at pages 7-9, the Staff supports the Rambus Motion in this regard.8 In particular, the Staff agrees with Rambus that no genuine issue of material fact remains in dispute as to the asserted Dally patent claims being exempted from PCI-SIGs FRAND obligations due to the third-party payment exclusion. The Respondents arguments to the contrary are flawed and should be rejected. More specifically, two sections of the PCI-SIG bylaws are relevant here. Section 15.3 on its face requires PCI-SIG members to grant other members and their affiliates a license on FRAND terms to Necessary Claims. See Exhibit 25 to Rambus Motion at THIRDPARTY000249. There does not appear to be a meaningful dispute as to the interpretation of Section 15.3 in this regard. However, disagreement does exist over how the term Necessary Claims is defined in the related Section 15.1, which reads:

Rambus also addresses a potential argument by the Respondents that Rambus or its predecessor-in-interest to the Dally patents failed to meet a non-existent duty to disclose the Dally patents to PCI-SIG. See Rambus Motion at 17. To the extent such an argument is indeed made by the Respondents, the Staff supports Rambuss position in this regard. PUBLIC VERSION

14 Necessary Claims means those claims of all patents and patent applications throughout the world which a Member or its Affiliates has the right, any time during the term of this Agreement, to grant licenses of the nature agreed to be granted herein without such grant resulting in payment of royalties or other consideration to third parties (except for payments to Affiliates or employees). See id. at THIRDPARTY000247 (bold in original, underlining added for emphasis). Broadcom appears to be of the view that Section 15.1 distinguishes between two types of third-party payment schemes, only one of which is exempted from the FRAND obligations in Section 15.3. In the first scheme, which Broadcom calls a grant-based fee arrangement, a prospective licensee member pays an exclusive licensee, who in turn pays a sublicensing fee to the patent holder.9 According to Broadcom, this first scheme is exempt from the FRAND obligations in Section 15.3. In the second scheme, which Broadcom calls a revenue sharing arrangement, a prospective licensee member pays royalties to both an exclusive licensee and the patent holder.10 According to Broadcom, this second scheme is not exempt from the FRAND obligations in Section 15.3. The only apparent distinctions between the two schemes appear to be who is ultimately paying the patent holder and whether the payment is called a royalty or a sublicensing fee. Broadcom argues that the Rambus-MIT arrangement is of the second, non-exempt type, because Rambuss predecessor-in-interest (which had the right to sublicense the Dally patents)

See Proposed Reply at 11-12 ([A] patent owner will often require payment of a sublicensing fee from the exclusive licensee if the exclusive licensee sublicenses the patent to a third party. Accordingly, the PCI-SIG signatories agreed that where the grant itself of rights to Necessary Claims would result in a liability to the signatory, the FRAND obligation may not attach.) (emphasis in original).

See Proposed Reply at 12 (Here, on the other hand, no execution fee payable to MIT would apply to Velios grant of a license to other signatories. Rather, Velio and MIT would share in any subsequent amounts collected from the FRAND license. This arrangement to share future royalties collected is not the type of grant-based fee excepted from the PCI-SIGs FRAND obligation.) (internal citations omitted). PUBLIC VERSION

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15 and MIT (the patent holder), were to share in any subsequent amounts collected from prospective licensees. See Proposed Reply at 12. In the Staffs view, Broadcoms rejection of the plain language of the PCI-SIG bylaws which do not distinguish between grant-based fee arrangements and revenue sharing arrangements is unsupportable and should be rejected. Specifically, Broadcoms argument appears to be erroneously premised on the fact that Velio and its employees thought (perhaps mistakenly) that they were required to license PCI-SIG members to the Dally patents despite the contrary language in Section 15.1, and on the fact that Rambus allegedly shared in that view when it reduced its purchase offer after Velios participation in PCI-SIG came to light. See Proposed Reply at 12. The Staff submits that such extrinsic evidence is irrelevant because the language in Section 15.1 is clear and unambiguous on its face. See Certain Coamoxiclav Products, Potassium Clavulanate Products, and other Products Derived From Clavulanic Acid, Inv. No. 337-TA-479, Order No. 7, 2003 ITC LEXIS 216, at *45 (Mar. 6, 2003) ([T]he administrative law judge finds that the Settlement Agreement, insofar as it relates to whether or not complainants have relinquished their trade secret allegation and whether or not complainants can state a claim for conversion is unambiguous on its face, and therefore the use of extrinsic evidence in interpreting the document is unnecessary and inappropriate.); Certain Personal Computers With Memory Management Information Stored in External Memory and Related Materials, Inv. No. 337-TA-352, Order No. 25, 1994 ITC LEXIS 355, at *52 (June 6, 1994) (As a matter of law, the Intel-ST agreement is unambiguous; therefore, no extrinsic evidence regarding the intent of the parties is admissible.). Thus, Broadcoms attempt to use extrinsic evidence to rewrite Section 15.1 and thereby overcome the plain language of the bylaws should be rejected.

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16 When the proper interpretation of Section 15.1 is applied, the shortcomings in the Respondents PCI-SIG defenses become clear. The plain language of that section excludes from PCI-SIGs FRAND obligations any patent for which the license grant would result[] in payment of royalties or other consideration to third parties even if an implementation of a PCI-SIG standard would necessarily infringe a claim therein. See Exhibit 25 to Rambus Motion at THIRDPARTY000247. The asserted Dally patent claims fall within this exemption -- a license grant to the asserted Dally patent claims would result in the payment of royalties to third party MIT. See Rambus Motion at 10-12 (summarizing third party royalty obligations involving MIT). Even Broadcom appears to recognize this point. See Proposed Reply at 12 (MIT would share in any subsequent amounts collected from the FRAND license.). Thus, the Respondents PCI-SIG-based defenses necessarily fail. Summary determination rejecting those defenses should therefore be granted. IV. CONCLUSION For the foregoing reasons, the Staff is of the view that there is no genuine issue of material fact in dispute as to the obligations (or lack thereof) arising out of Rambuss SSO participation, which does not preclude the relief sought by Rambus in this investigation. The Staff thus supports Rambuss motion for summary determination and disagrees with contrary allegations made by Broadcom in its Proposed Reply. The Staff further submits that Broadcom has failed to demonstrate good cause for filing its Proposed Reply, which focuses largely on facts, cases, and legal issues that should have been addressed in its motion to terminate. The Staff thus opposes Broadcoms motion for leave.

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17 Respectfully Submitted, /s/ Daniel L. Girdwood Lynn I. Levine, Director David O. Lloyd, Supervisory Attorney Daniel L. Girdwood, Investigative Attorney OFFICE OF UNFAIR IMPORT INVESTIGATIONS U.S. International Trade Commission 500 E Street S.W., Suite 401-H Washington, D.C. 20436 202.205.3409 (ph) 202.205.2158 (fax) Confidential Version: Public Version: July 18, 2011 July 26, 2011

PUBLIC VERSION

Certain Semiconductor Chips And Products Containing Same CERTIFICATE OF SERVICE

Inv. No. 337-TA-753

The undersigned certifies that on July 26, 2011, he caused the foregoing COMBINED RESPONSE OF THE COMMISSION INVESTIGATIVE STAFF TO MTN DKT. NOS. 753-030 AND 753-034 (PUBLIC VERSION) to be filed with the Commission, served by hand upon Administrative Law Judge Theodore R. Essex (2 copies plus a courtesy .pdf copy to [email protected]), and served upon the parties (1 copy each) in the manner indicated below: Complainant Rambus Inc. Christine E. Lehman c/o Finnegan Henderson 901 New York Ave., N.W. Washington, D.C. 20001-4413 202.408.4000 (ph) 202.408.4400 (fax) [email protected] Respondents Broadcom Corp. Mediatek Inc., Cisco Systems Inc. Motorola Mobility Inc., Oppo Digital Inc., Audio Partnership PLC, and nVidia Corp. Thomas Pease c/o Quinn Emanuel 51 Madison Ave., 22nd Floor New York, N.Y. 10010 212.849.7000 212.849.7100 Via Email Via Email

[email protected] [email protected] (secondary counsel for Broadcom, MediaTek, Oppo Digital, and Audio Partnership) S&[email protected] (secondary counsel for Motorola) [email protected] (secondary counsel for Broadcom) [email protected] (secondary counsel for nVidia) [email protected] (secondary counsel for nVidia) [email protected] (secondary counsel for Cisco)

Respondents LSI Corp. and Seagate Technology Jonathan D. Link c/o Kilpatrick Townsend & Stockton LLP Suite 900 607 14th St., N.W. Washington, D.C. 20005 202.508.5800 (ph) 202.508.5858 (fax) [email protected] [email protected] Respondents ASUSTek Computer Inc., Asus Computer Intl Inc., Biostar Microtech (USA) Corp., Biostar Microtech Intl Corp., EliteGroup Computer System Co. Ltd., EVGA Corp., Galaxy Microsystems Ltd., Giga-Byte Tech. Co. Ltd., G.B.T. Inc., Hewlett-Packard Co., Jaton Corp., Jaton Technology TPE, Micro-Star Intl Co., MSI Computer Corp., Gracom Tech. LLC, Palit Microsystems Ltd., Pine Technology Holdings Ltd., Sparkle Computer Co. Ltd., Zotac USA Inc., and Zotac Intl (MCO) Ltd. Andrew R. Kopsidas c/o Fish Richardson 1425 K Street, N.W. - 11th Floor Washington, D.C. 20005 202.783.5070 (ph) 202.283.7331 (fax) [email protected] Respondents STMicroelectronics N.V. and STMicroelectronics Inc. Eric Rusnak c/o K&L Gates 1601 K Street, N.W. Washington, D.C. 20006 202.778.9000 (ph) 202.778.9100 (fax) [email protected] Respondent Hitachi Global Storage Tech. Alexander J. Hadjis c/o Morrison & Foerster 2000 Pennsylvania Ave., N.W. Suite 600 Washington, D.C. 20006 202.887.1500 (ph) 202.887.0763 (fax) [email protected] Via Email Via Email Via Email Via Email

Respondent Garmin Intl Louis S. Mastriani c/o Adduci, Mastriani & Schaumberg LLP 1200 Seventeenth St., N.W. - 5th Floor Washington, D.C. 20036 202.467.6300 (ph) 202.466.2006 (fax) [email protected] Third Party PCI-SIG Jonathan E. Mansfield c/o Schwabe, Williamson & Wyatt PacWest Center 1211 S.W. 5th Ave., Suite 1900 Portland, O.R. 97204 503.222.9981 (ph) 503.796.2900 (fax) [email protected] [email protected] Via Email Via Email

/s/ Daniel L Girdwood Office Of Unfair Import Investigations U.S. International Trade Commission 500 E Street, S.W., Suite 401-H Washington, D.C. 20436 202.205.3409 202.205.2158 (Facsimile)