Statement of M. Sean Royall, Deputy Director FTC Bureau of Competition and Trial Counsel

In the Matter of Rambus Incorporated

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The Federal Circuit today, in a split decision, ruled on an appeal in a private suit involving Rambus and one other private party, Infineon Technologies AG. That suit involved claims of fraud against Rambus brought under Virginia state law. The Federal Circuit, in its decision, applied Virginia state law to the factual record developed in a twelve-day jury trial that concluded in May 2001. Following Virginia law, the Federal Circuit scrutinized the prior finding of fraud against Rambus based on a heightened "clear and convincing evidence" standard of proof.

Commenting on today's Federal Circuit ruling, M. Sean Royall, Deputy Director of the FTC's Bureau of Competition, and lead trial counsel stated, "Our trial team is reviewing the Federal Circuit's decision to determine what if any bearing it may have on the Commission's federal antitrust suit against Rambus. However, given the significant differences in the factual and legal issues raised by the FTC's antitrust claims and Infineon's fraud claims, we do not expect that this ruling will have a substantial impact on our case going forward."

In June of last year, the Federal Trade Commission sued Rambus Inc. alleging that the company had violated federal antitrust laws. That suit is currently being litigated before an FTC administrative law judge. Presently, FTC staff attorneys are continuing to develop facts relevant to the Commission's antitrust claims, through discovery being taken directly from Rambus and numerous third parties. The volume of evidence being produced in discovery to the FTC is substantial. For instance, Rambus recently has stated publicly that it expects to produce more than 500,000 pages of documents to FTC counsel. The case is presently set for an administrative hearing on April 9, 2003. To prevail on its claims, the FTC will be required to show, by a "preponderance of the evidence," that Rambus committed violations of federal antitrust law.

In July 2002, Rambus moved to stay, or postpone, the FTC's suit against the company based on the fact that the Federal Circuit had not yet ruled in the Infineon suit. FTC lawyers opposed any such postponement, in part based on the distinct legal issues, factual records, and standards of proof at issue in the present FTC suit and the May 2001 fraud verdict. The administrative law judge presiding over the FTC's action denied Rambus's motion to stay, in an order dated July 18, 2002. That order, and the public versions of all briefs submitted in connection with Rambus's motion for stay, are available on the FTC's website.

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