Broadcom Loses Ruling in Challenge From Intel

A small number of Broadcom Corp.’s products violate two patents held by computer chip giant Intel Corp., an administrative judge for the U.S. International Trade Commission has determined.

If the commission upholds the judge’s findings, which were disclosed Friday, Broadcom could be barred from importing the products in question to the U.S. Broadcom, a communications chip maker based in Irvine, relies on overseas manufacturers to produce its products.

The case was originally filed by Intel against Altima Communications Inc., which Broadcom acquired in September.

Intel initially claimed that four of its patents were being violated. One claim was dropped. Judge Paul Luckern denied one claim and upheld two others.

Intel is “gratified by the ruling,” said Chuck Malloy, a company spokesman. “We spend billions of dollars a year in developing our intellectual property, and it’s our belief that we’ve got an obligation to protect it.”

The ruling, if it becomes final, would have no financial impact on Broadcom’s business, said Broadcom attorney Steve Anzalone in Washington.

The offending devices, used for managing components in computer networks, “were a small market to begin with and they’re a diminishing market,” Anzalone said.

Analyst Charles Glavin also said there should be no financial effect. “Intel won bragging rights, but that’s about it,” said Glavin, with Credit Suisse First Boston.

Broadcom’s shares fell $1.40 to close at $41 and Intel shares were off 3 cents at $29.93, both on Nasdaq.

Broadcom will petition the commission to review the decision, Anzalone said. The commission rarely overturns an administrative judge’s findings, however, said Washington patent attorney Garret Rasmussen, who is not involved in the case.