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    WOW. AMD fights back

    Discussion in 'Notebook News and Reviews' started by labradogs1, Jun 28, 2005.

  1. labradogs1

    labradogs1 Notebook Geek

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    AMD files antitrust suit against Intel

    :hardfind: Advanced Micro Devices Inc. (NYSE:AMD - news) has filed an antitrust lawsuit charging that Intel Corp. (Nasdaq:INTC - news), its chief competitor, used everything from threats to kickbacks in illegally building the world's largest computer-chip business.

    AMD's 48-page lawsuit, filed in U.S. District Court in Delaware, is the latest shot in a long battle between the two rivals and comes after a recent ruling by Japanese antitrust authorities that Intel had violated anti-monopoly laws and stifled competition with AMD.

    The current lawsuit expands those charges, alleging that across three continents Intel coerced 38 companies, including such household names as Dell Inc. (Nasdaq :DELL - news), Sony Corp. (6758.T) and Gateway Inc. (NYSE:GTW - news), to win business over a period of years.

    "Everywhere in the world, customers deserve freedom of choice and the benefits of innovation -- and these are being stolen away in the microprocessor market," Hector Ruiz, AMD chairman, president and chief executive, said in a statement on Tuesday.

    Charles Diamond, an attorney with O'Melveny & Myers LLP who led AMD's investigation, said in an interview that the company could seek "hundreds of millions of dollars if not billions of dollars" in damages and hopes to have the case before a jury by the end of 2006.

    Diamond said he would be open to settlement discussions. He declined to say whether any talks have yet taken place related to the suit, which paints a dark picture of cutthroat practices in the computer business.

    In one instance, AMD charged, former Compaq Chief Executive Michael Capellas said in 2000 that "he had a gun to his head" and would have to stop buying from AMD. He said Intel was withholding delivery of critical server chips because of the volume of business he was doing with AMD, according to the lawsuit.

    In another, Gateway executives told AMD that Intel had "beaten them into 'guacamole"' in retaliation for doing business with AMD, according to the papers.

    AMD charges that even retailers were strong-armed by Intel. It said Best Buy Co. Inc. (NYSE:BBY - news) and Circuit City Stores Inc.(NYSE:CC - news) were "effectively" required to stock Intel computers "overwhelmingly or exclusively," limiting choices to customers.

    Shares of Intel, the world's largest chip maker, were down 8 cents at $25.80 in early trading on the Nasdaq. Intel could not immediately be reached for comment.

    AMD shares were up 24 cents, or 1.4 percent, at $16.91 in early New York Stock Exchange trading.

    Intel also faces scrutiny from European Union investigators looking into complaints from AMD.

    "We are trying to bust open Intel's choke hold over the computer companies and get the right to compete freely and fairly for every processor they buy," Diamond said.

    "This is about fair and open competition. This is about giving our customers, the computer manufacturers, freedom to buy from whom they choose and this is about giving consumers the right to buy the best prod at the lowest products to suit their needs," he said. "That's not happening right now." :hardfind:

    (Additional reporting by Cal Mankowski and Sinead Carew)
     
    labradogs1, Jun 28, 2005
    #1