Samsung settles patent suit with Rambus for $900 million

South Korean electronics giant Samsung Electronics has settled its long-running semiconductor patent battle with Rambus Inc, a designer and developer of memory chips by agreeing to pay $900 million over a period of five years.

Los Altos, California-based Rambus, the designer of chips for Sony's PlayStation video-game console, had developed a new RDRAM technology to improve data transfer efficiency by allowing varying amounts of data to be sent per a memory read or write request in RDRAMs and flash memory and convinced a few chip makers to licence its new technology.

Rambus accused Samsung, Hynix Semiconductor and Micron of making its RDRAM technology look inferior to another cheaper DRAM chip by limiting the supply of its chip and pushing the cheaper RDRAM memory chip in the market.

Rambus also accused these companies of colluding to fix prices, which hurt the sales of its RDRAM memory chip.

Under the settlement, which comes just days before the start of the antitrust trial in San Francisco, Samsung will pay Rambus an initial payment of $200 million and a quarterly payment of about $25 million for the next five years.

Samsung will also buy $200 million worth of newly issued Rambus stock.