EC still holds Intel accountable even after AMD settlement

Despite an historic resolution to AMD's and Intel's long-standing business practices and intellectual property disputes this morning, the official position of the European Commission -- which issued formal objections to, and fines for, Intel's alleged conduct last May -- is that nothing whatsoever has changed with regard to its ongoing prosecution of its Statement of Objections.

In a statement to Betanews this afternoon, EC spokesperson Jonathan Todd said: "The Commission takes note that Intel and AMD have settled all their litigation and that Intel is paying AMD compensation of $1.25 billion. Intel has an ongoing obligation to comply with the Commission's May 2009 Decision and with EU antitrust law. The Commission continues to vigorously monitor Intel's compliance with its obligations under the May 2009 Decision."

Although AMD is likely to continue cooperating with regulators worldwide, its active participation in their efforts is likely to subside, but not yet completely.

"The regulatory investigations and enforcement actions around the world are conducted by sovereign governments pursuant to law and their mandates to protect competitive processes and consumer value," said AMD Executive Vice President for Legal Affairs Tom McCoy this morning. "So the regulators will do what they are going to do; and what we would say is that, from our perspective, we are withdrawing, obviously, from all pending litigation. We will be withdrawing all complaints that have been lodged with regulatory agencies, and if asked, we will say that the agreement, to a great extent, resolves outstanding disputes between AMD and Intel under the antitrust laws. There are some exceptions, there are some practices that we believe are exclusionary, that we will, under the agreement, there are a narrow set which we will continue to advocate to the regulators should be addressed for the health of the industry; and Intel will have its own point of view of that, of course. So the regulatory agencies still have a role to play, but from our perspective, this agreement significantly resolves our concerns."

From Intel's perspective, all of the regulatory concerns that governments may have stem from AMD's original civil complaint. And now that that's over, Intel believes, the rest of it all should follow.

"In terms of regulators, I think in general, all of these comments that have been coming from regulators, and actions, have been as a result of the complaints between these two private parties," said Intel CEO Paul Otellini this morning. "Now that the issues between the private parties are settled, I think that should provide some degree of comfort for the regulators, at least in terms of our behaviors and how we're going to compete in the marketplace, and so forth. Beyond that, they may have their other concerns in areas like pricing, as we've mentioned, that we may still want to them and they may want to talk to us about."

Endpoint analyst Roger Kay later pressed the Intel executives for further clarity, including with regard to the New York Attorney General's antitrust complaint, filed last week.

"In the places in the world where AMD had complaints against us, those will be withdrawn," responded Intel Executive Vice President for Legal Affairs Andy Bryant. "In places where governments around the world were asking us questions, those will continue on. Actually the EU appeal will continue on...We are having discussions with the [US] FTC; currently, there are other countries in the world who have asked us questions, we will still continue to talk to them, answer their questions. And of course, we have the New York Attorney General situation to deal with."

This prompted a Fortune Magazine correspondent to ask whether A-G Andrew Cuomo's complaint -- which contained never-before-public e-mails from Intel execs, including Otellini, as evidence of improper conduct -- led Intel to conclude it must settle now with AMD to avoid embarrassment.

Otellini responded first by revealing that settlement talks with AMD actually began last April, before the EC's Statement of Objections. In fact, it's conceivable that had the EC suspended its operations for another month, it might have discovered it had less to complain about.

With respect to Mr. Cuomo's filed complaint, Otellini added, "On some of the statements in there that were attributed to me, yeah, I wrote some of those, at least the ones I remember. On the other hand, many of those documents are taken broadly out of context. When the full nature of the e-mails is exposed, I think that you'll see there's another way to interpret some of these statements. Remember, there were 200 million pages of documents produced, and these were four or five snippets out of 200 million pages. So we're anxious to talk about our side of the story and show our other halves of e-mails, and so forth, as we go forward."

Betanews has shared some of Otellini's statements with Attorney General Cuomo's office, and we may expect a response from him later in the day.

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