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Intel and FTC settle their differences

By Tony Hallett

Published: Tuesday 09 March 1999

The US Federal Trade Commission's (FTC) long-awaited anti-trust action against Intel has been brought to a halt. Following sensational eleventh hour negotiations, it was announced yesterday that the parties had reached a partial settlement - before the trial even began.

Judge James P Timony, who was due to oversee the trial, issued a statement saying the case will be withdrawn from adjudication while he considers a proposed settlement agreement.

The FTC will now take between 10 and 14 days to approve a tentative settlement that has been reached between the chip giant and FTC's Bureau of Competition.

In a prepared statement, Craig Barrett, president and chief executive officer of Intel, said: "We view this compromise agreement as a win-win for both parties and we are satisfied that the agreement gives us value for our intellectual property rights. This is acceptable to both parties and was the result of constructive dialog between Intel and the FTC."

Some 16 months after beginning an investigation into the chip manufacturer, the FTC was due to claim that three companies had been victims of Intel's monopoly power - Compaq, Digital (now part of Compaq) and Intergraph, an Alabama-based manufacturer of powerful NT workstations.

The three companies sued Intel for demanding royalty-free rights to certain technologies, but Intel retaliated by threatening to withdraw valuable blueprints for its future processor designs - illegally, according to the FTC.