Court Rules SanDisk Must Stand Trial On Fraud, Patent Misuse and Unfair Competition.Business Editors FREMONT, Calif.--(BUSINESS WIRE)--Oct. 23, 2000 Lexar Media, Inc. (Nasdaq:LEXR), today announced that the Northern District of California has ruled that SanDisk (Nasdaq:SNDK) must stand trial on Lexar's claims of fraud, patent misuse In the United States, patent misuse is an affirmative defense used in patent litigation after the defendant has been found to have infringed a patent. This umbrella term usually describes:
"SanDisk claims that its patent covers all CompactFlash cards and they appear to be seeking a royalty from every manufacturer of those cards. Yet they have always promoted the CompactFlash standard as an open one. If SanDisk's '987 patent is as broad as they believe it is, then it should have been disclosed to the industry standards-setting bodies such as the Personal Computer Memory Card International Association (body, hardware, standard) Personal Computer Memory Card International Association - (PCMCIA, or "PC Card") An international trade association and the standards they have developed for devicies, such as modems and external hard disk drives, that can be plugged into notebook (PCMCIA (Personal Computer Memory Card International Association, San Jose, CA, www.pcmcia.org) An international standards body and trade association that was founded in 1989 to establish a standard for connecting peripherals to portable computers. PCMCIA created the PC Card. See PC Card. ) and CompactFlash Association (CompactFlash Association, Palo Alto, CA, www.compactflash.org) A membership organization founded in 1995 by SanDisk, Canon, Motorola, HP and others. Its goal is to promote CompactFlash as the premier open standard for storage for digital appliances and handheld devices. See CompactFlash. (CFA (Computer Fraud and Abuse Act of 1986) Signed into law in 1986, the CFA was a significant step forward in criminalizing unauthorized access to computer systems and networks. The Act applies to "federal interest computers" that include any system used by the U.S. ) at the time of the standard's development," said John Reimer John Henry Reimer (born July 16, 1936) is a Canadian politician. He served in the Canadian House of Commons from 1979 to 1980, and again from 1984 to 1993, as a member of the Progressive Conservative Party. Reimer was born to a Mennonite family in Kitchener, Ontario. , President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Lexar Media, Inc. "We believe that this anticompetitive an·ti·com·pet·i·tive adj. That discourages competition among businesses: anticompetitive foreign trade restrictions. behavior is harmful to the entire industry. We are also pleased that the Court will review SanDisk's patent misuse which includes our allegations of unlawful tying whereby SanDisk has refused to license the '987 patent unless the licensee purchases flash memory from certain SanDisk designees. We therefore look forward to not only the Court's review of the validity of SanDisk's patent, but also the manner in which it was obtained." The judge has rescheduled the trial to November 6, 2000. The trial was originally scheduled to commence on October 23, 2000. About Lexar Media Lexar Media is a leading designer, developer and marketer of high-performance digital film and connectivity products for the digital photography market. Lexar Media offers digital film in the four most popular industry formats: CompactFlash, Memory Stick, SmartMedia and PC Cards. Its broad line of high-performance digital film combines flash memory from leading suppliers with its patented controller technology to address the needs of professional, commercial and consumer photographers. Lexar Media's connectivity products make it easy to transfer images from their digital film to a personal computer. Lexar Media's online photofinishing site, Printroom.com, provides consumers with high quality prints of digital images and photo sharing Photo sharing is the publishing or transfer of a user's digital photos online, thus enabling the user to share them with others (whether publicly or privately). This functionality is provided through both websites and applications that facilitate the upload and display of images. services. Lexar Media recently launched SayCheese.com, an online community and educational site for digital photographers of all levels. Collectively, its products and services provide an end-to-end solution (jargon) end-to-end solution - (E2ES) A term that suggests that the supplier of an application program or system will provide all the hardware and/or software components and resouces to meet the customer's requirement and no other supplier need be involved. Compare: turn-key solution. for digital photographers. Lexar Media is headquartered in Fremont, California and has offices in England and Japan. Information on Lexar can be obtained through its toll-free number 800/789-9418 or by accessing www.digitalfilm.com. Cautionary Note Regarding Forward-Looking Statements This news release contains forward-looking information within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and is subject to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. created by those sections. These forward-looking statements include statements related to the redesign of Lexar's products and Lexar's ongoing litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. with SanDisk. These forward-looking statements involve a number of risks and uncertainties that could cause the Company's actual results to differ materially from those anticipated by these forward-looking statements. These risks include that the redesigned products may not be feasible to produce, commercially competitive or have all the functionality of the Company's current and future products or may be held to infringe SanDisk's patents or the patents of others, the Company's litigation with SanDisk could require the Company to pay significant damages and royalties and it could be enjoined from making selling or using the infringing products and the Company could be involved in additional litigation with SanDisk or others, which could divert management's time and attention, could be time-consuming and expensive, limit the Company's access to important technology and could threaten the Company's viability. Readers should also refer to the risk factors described in Lexar's registration statement on Form S-1 declared effective by the Securities and Exchange Commission on August 14, 2000. Lexar assumes no obligation to update the forward-looking information contained in this news release. Lexar Media, the Lexar logo and Printroom.com are trademarks of Lexar Media, Inc. Lexar Media Inc. is an authorized licensee of the CompactFlash trademark. All other brand or product names are trademarks or registered trademarks of their respective holders. |
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