UPDATE: ITC Staff Supports Rambus In Nvidia Chip Patent Case

A staff report of the U.S. International Trade Commission says Nvidia Corp. (NVDA) illegally uses technology owned by Rambus Inc. (RMBS), and recommends a ban on U.S. imports of Nvidia's graphics chips.

Rambus, based in Los Altos, Calif., has alleged that Santa Clara, Calif.-based Nvidia uses its technology in its computer-based graphics chips.

An attorney with the ITC, Daniel Girdwood, said in the document that Nvidia has infringed on two patents owned by Rambus. He also dismissed claims by Rambus on three other patents. His report was made public on the ITC's Web site on Thursday, although a confidential version was released in September.

Girdwood is the staff attorney who acts in the public's interests. While some may take his recommendation as an indication of ITC's possible decision on the matter, it is ultimately up to the judge, who at times will rule differently.

A trial on the case began Tuesday and is ongoing. The original complaint was filed to the ITC by Rambus in November.

Nvidia declined to comment and Rambus wasn't immediately available for comment.

Rambus shares fell 2.5% to $18.54, while Nvidia retreated 2.8% to $13.15.

-By Roger Cheng, Dow Jones Newswires; 212-416-2153; [e-mail]