Netlist's Amended Complaint Provides Details in ULLtraDIMM Litigation -- Sixty Trade Secrets Believed Stolen by Diablo
March 25 2014 - 9:00AM
Marketwired
Netlist's Amended Complaint Provides Details in ULLtraDIMM
Litigation -- Sixty Trade Secrets Believed Stolen by Diablo
IRVINE, CA--(Marketwired - Mar 25, 2014) - Netlist, Inc.
(NASDAQ: NLST), a leading provider of high performance memory
solutions for the cloud computing and storage markets, announced
today that it has filed a Second Amended Complaint in the lawsuit
against Diablo Technologies, Inc., related to the recently released
ULLtraDIMM memory module. The complaint details Diablo's theft of
Netlist's breakthrough HyperCloud® technology and its incorporation
of the stolen trade secrets in the ULLtraDIMM product Diablo
produced in partnership with Smart Storage Systems, Inc. This trade
secret lawsuit and the related suit asserting infringement of seven
Netlist patents against the ULLtraDIMM are pending before Judge
Yvonne Gonzalez Rogers in the United States District Court for the
Northern District of California in Oakland, California. In the
complaint, Netlist seeks, among other things, an injunction against
the ULLtraDIMM product, as well as damages, royalties and
restitution for Diablo's misappropriation of Netlist's trade
secrets.
As described in the complaint, Diablo exploited its position as
a trusted vendor to steal Netlist's most valuable intellectual
property and incorporate the stolen technology in the ULLtraDIMM.
Netlist disclosed to Diablo in confidence, for the sole purpose of
building products for Netlist, the core specifications
for HyperCloud®, and spent significant engineering resources
over several years teaching Diablo how to implement these
technologies. The complaint details how Diablo stole these
proprietary specifications and designs and used them to create its
own products including the ULLtraDIMM. In the process, Diablo
transformed itself from a contract design house to a "products
company", leveraging this theft to build a reputation for new
technology development that it does not deserve.
"Diablo's theft of Netlist's most valuable IP violates all norms
of fair dealing between companies in our industry that play by the
rules," said Netlist President and CEO, C.K. Hong. "We intend to
bring Diablo's long course of unlawful conduct to light and to
vigorously pursue every available remedy for its theft, including
an injunction."
Netlist has also served an Amended Trade Secret Disclosure
describing in detail approximately 60 technical trade secrets
taught and disclosed by Netlist to Diablo, and, as described in the
complaint, believed to reside in the ULLtraDIMM. Among these trade
secrets are: (a) Netlist's LRD/DxD chipset architecture, including
communication control architecture, control information extraction,
write-leveling operations, and chipset pin definitions and
operation modes; (b) Netlist's ASIC controller architecture,
including multiplexing proprietary and standard operations, rank
register controller, and access control architecture; (c) Netlist's
isolation switch device architecture; and (d) novel features in
Netlist's architecture for memory module self-test.
About Netlist:
Netlist, Inc. designs and manufactures high-performance,
logic-based memory subsystems for server and storage applications
for cloud computing. Netlist's flagship products include
HyperCloud®, a patented memory technology that breaks traditional
performance barriers, NVvault™ and EXPRESSvault™, the pioneering
family of hybrid memory products utilizing both DRAM and NAND Flash
that significantly accelerates system performance and provides
mission critical fault tolerance, and a broad portfolio of
industrial flash and specialty memory subsystems including VLP
(very low profile) DIMMs and Planar-X RDIMMs. Netlist has steadily
invested in and grown its IP portfolio, which now includes 43
issued patents and more than 30 US and foreign pending patent
applications in the areas of high performance memory and hybrid
memory technologies.
Netlist develops technology solutions for customer applications
in which high-speed, high-capacity, small form factor and efficient
heat dissipation are key requirements for system memory. These
customers include OEMs that design and build tower, rack-mounted,
and blade servers, storage hardware, high-performance computing
clusters, engineering workstations and telecommunications
equipment. Founded in 2000, Netlist is headquartered in Irvine, CA
with manufacturing facilities in Suzhou, People's Republic of
China. Learn more at www.netlist.com.
Safe Harbor
Statement: This news release contains forward-looking
statements regarding future events and the future performance of
Netlist. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially
from those expected or projected. These risks and uncertainties
include, but are not limited to, risks associated with the launch
and commercial success of our products, programs and technologies;
the success of product partnerships; continuing development,
qualification and volume production of EXPRESSvault™, NVvault™,
HyperCloud® and VLP Planar-X RDIMM; the timing and magnitude of the
anticipated decrease in sales to our key customer; our ability to
leverage our NVvault™ technology in a more diverse customer base;
the rapidly-changing nature of technology; risks associated with
intellectual property, including patent infringement litigation
against us as well as the costs and unpredictability of litigation
over infringement of our intellectual property and the possibility
of our patents being reexamined by the United States Patent and
Trademark office; volatility in the pricing of DRAM ICs and NAND;
changes in and uncertainty of customer acceptance of, and demand
for, our existing products and products under development,
including uncertainty of and/or delays in product orders and
product qualifications; delays in the Company's and its customers'
product releases and development; introductions of new products by
competitors; changes in end-user demand for technology solutions;
the Company's ability to attract and retain skilled personnel; the
Company's reliance on suppliers of critical components and vendors
in the supply chain; fluctuations in the market price of critical
components; evolving industry standards; and the political and
regulatory environment in the People's Republic of China. Other
risks and uncertainties are described in the Company's annual
report on Form 10-K filed on March 29, 2013, and subsequent filings
with the U.S. Securities and Exchange Commission made by the
Company from time to time. Except as required by law, Netlist
undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
For more information, please contact: Brainerd Communicators,
Inc. Corey Kinger/Mike Smargiassi NLST@braincomm.com (212)
986-6667
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