This week, Realtek sued rival MediaTek in Northern California federal court, accusing it of conspiring against it with a patent holder in a bid to drive Realtek out of business. Reuters reports that Realtek asserts that MediaTek intends to monopolize the markets of smart TVs and set-top-boxes and asks the court to protect itself from the ongoing injury and the market from unfair competition practices.

It is not a secret that various patent assertion entities (PAE), a juridical term for patent hoarders, acquire patents and then sue different designers for royalties. In 2019, MediaTek entered into a patent license agreement with Future Link and its owner IPValue to license some of the patents issued initially to NXP Semiconductor and Philips. While this would be a reasonably typical license agreement, it contained a secret provision, which included MediaTek's demanding Future Link act against its rivals, including Realtek. 

Future Link sued Realtek for alleged patent infringement on April 13, 2021, accusing the chip designer of infringing two of its patents related to TV SoCs. By the end of 2021, Future Link reportedly expanded the list of its allegations against Realtek with two more patents and then dropped some of the claims. The important thing here is that Future Link alleges that all of Realtek's products that use Arm's AXI interface for multi-core SoCs infringe its patents, which in turn means that virtually all of Realtek's TV chips use its IP illegally and have to be barred from the market, which will eliminate a rival for Mediatek, which already controls 60% of the TV SoC market, according to Reuters citing the lawsuit.

At the time, Realtek was not aware that the action brought by Future Link was inspired by its rival MediaTek, the company says. 

"In April 2022, there was a shocking revelation regarding that seemingly innocuous agreement," Realtek states. "Discovery revealed that before the litigation against Realtek began, the license agreement among MediaTek, IPValue, and Future Link included a secret litigation 'bounty' provision previously hidden from the public and Realtek. […]. Specific details of this scheme remain hidden from the public even today because Future Link has managed to keep the arrangement buried under confidentiality obligations and protective orders."

On April 12, 2022, an Administrative Law Judge at the ITC said that the license agreement between Future Link and MediaTek contained a demand for action against Realtek.

"At a minimum, it would seem to warrant an action by Realtek against either Future Link or its counterparty for unfair competition," the ALJ wrote. 

Realtek says its move aims to counter a modern-day monopolist and its allies to protect itself, uphold competition in the semiconductor industry, and hold the offenders — MediaTek, Future Link, and IPValue — accountable. Any damages recovered by Realtek from this action will be donated to charity.

"Because Realtek seeks to protect the public interest with this action, Realtek will donate the amount of damages that it recovers to charity," the company said.

MediaTek, Future Link, and IPValue did not comment on the story.

Sources: ReutersReuters (PDF)

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  • meacupla - Wednesday, June 7, 2023 - link

    If you want more reason to hate mediatek, the first thing that shows up on their website is their CEO holding hands with Jensen Huang.
  • alphachannel - Wednesday, June 7, 2023 - link

    The claws come out
  • thestryker - Wednesday, June 7, 2023 - link

    I don't think I've ever seen a more on the nose name for a patent troll company than "IPValue". This has needed to be addressed for years, but continues to move unchecked because the US congress is worthless at getting anything important done.
  • PeachNCream - Wednesday, June 7, 2023 - link

    I've never been a huge Realtek fan except that I rather preferred them over idiotic solutions like Killer-branded crapware that Ian Cutress used to drumbeat without understanding even a little about how data packets traverse public networks (heard that guy is floundering around on YouTube these days attempting to live off Google advertiser breadcrumbs like literally everyone else that thought they didn't need actual employment). At any rate, Realtek NICs were a better solution than Killer junk until Intel bought the brand and even though its still snake oil, at least it's built around reliable underlying hardware these days. However, patent trolls are filthy trash so here's hoping Realtek can convince the courts to banhammer this mess.
  • buttress - Thursday, June 8, 2023 - link

    What? His "industry connections" aren't there to help him now like he was there to serve them then? Bummer..
  • eastcoast_pete - Sunday, June 18, 2023 - link

    The key point is not that a patent troll behaves or behaved like one, but that Mediatek essentially paid them to harass their competitors as part of a supposed license deal. The fact that this part of Mediatek's license deal was kept secret ("confidential") shows already that they had their own doubts whether this is legal. As others have posted here, I'm not a fan of Related either, but using a patent troll as a cudgel to clobber the competition needs to be called out and stopped. I hope that this will result in a judgement compelling Mediatek and the trolls to pay serious damages. Because losing a lot of $$$$ is the only language those people understand.

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