SGI, Back From Dead, Decides To Use Patent Litigation As New Business Strategy

from the losers-litigate dept

What were we just saying about the trend of companies who failed in the marketplace to resort to patent infringement lawsuits as a last gasp effort to stay alive? When SGI filed for Chapter 11 bankruptcy back in May, many didn't give the company much of a chance of amounting to much if it could even reorganize and come out of bankruptcy. Well, last week, the company triumphantly emerged from bankruptcy, claiming that it was "lean and mean." The company claimed it had new management, new business models and a new strategy. Of course, what they didn't mention was part of that strategy was to sue others for patent infringement. It certainly didn't take the "new" SGI long to send its lawyers after ATI for apparently infringing on a patent. Perhaps SGI has a real business strategy to become relevant again -- but to kick things off with a patent infringement lawsuit suggests that they're not convinced that actually competing with their products in the market place is going to take them very far.

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  1. identicon
    ehrichweiss, 24 Oct 2006 @ 10:19pm

    which is it?

    I always hear the arguement that someone shouldn't sue if they are simply in possession of patents and not actually doing anything with them eg. patent trolls so why does it matter if they "can't survive in the marketplace", isn't that why many companies then license our their technology? And hasn't it already been stated that litigation is the first step to negotiation for licensing?

    Besides, ever thought that they might have "made it in the marketplace" if they had done this litigation/licensing thing sooner? Or that they lost a lot of engineers to ATI and nVidia so infringement is bound to happen "accidentally". And I wouldn't say that SGI couldn't have made it in the marketplace, only that they had some management a few years ago who made some incredibly bad decisions concerning their architecture and the results were devastating.

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