Samsung, the biggest global DRAM producer, currently pays Rambus royalties of 3.5% on its double-data rate (DDR) DRAMs and 0.75% on its synchronous DRAMs.

But attorneys for Infineon revealed Monday that Samsung's licensing accord lets Samsung off the hook if Rambus loses in court on patent issues.

The clause, paragraph 3.9 in the Samsung contract with Rambus, was read verbatim to Federal Judge Robert Payne: "If a court determines that the [Rambus] patents have not been infringed in any geographic area, Samsung royalties will not apply in that geographic area."

It wasn't clear what "geographic area" referred to, but since the decision was made in a federal court, it could include all DDR and SDRAMs sold by Samsung in the United States.

Infineon obtained the confidential Samsung-Rambus licensing agreement during the pretrial discovery search for documents bearing on the case.

Judge Payne ruled last week that Infineon SDRAMs and DDR chips don't infringe the Rambus patents because the devices use no multiplexed memory bus line, which he said the Rambus technology requires.

It isn't clear if Samsung can immediately stop paying the royalties on synchronous memory chips sold in the U.S. because of the verdict in the Richmond trial.

Rambus is appealing the decision to the Federal Fourth Circuit of Appeals, and legal sources at the trial here couldn't assess whether Samsung might have to wait until the appellate court ruled before ceasing SDRAM and DDR royalties.

One patent source said it is common on appeal cases that a licensee freed from paying royalties in a lower court decision might have to pay the sums into an escrow fund, pending the appellate court ruling.

But in this instance, the Samsung royalties paid into an escrow fund could still not be recorded as revenue by Rambus during the appeals process, thus having a major negative impact on Rambus' bottom line, he added.

Avo Kanadjian, vice president of worldwide marketing for Rambus, declined to comment on Monday's testimony. Samsung didn't return a phone inquiry by presstime on Tuesday.

Infineon attorneys didn't disclose any other Rambus synchronous licensing agreements at the trial. Samsung, the largest global DRAM producer, would certainly be the highest potential source of licensing revenue for Rambus, and loss of that revenue would have a bigger impact than any of the other synchronous agreements Rambus has with seven other chip makers.

Legal sources at the trial, who asked to remain anonymous, said it's common for licensing agreements to include clauses similar to the Samsung stipulation, in order to protect the licensee from an economic disadvantage compared to its competitors.

The synchronous royalties, especially the 3.5% DDR rate, is important for Rambus, which reported that SDRAM and DDR payments in its first quarter accounted for the majority of its licensing revenue.

Royalties on the firm's core Direct Rambus DRAMs, which have been in the market for more than a year, still trail payments from the eight synchronous licensees. Infineon, Micron Technologies, and Hynix Semiconductor (formerly Hyundai Electronics) have refused to sign Rambus synchronous licenses and are in litigation in both U.S. and European courts with the memory design firm.

Meanwhile, the Richmond trial on alleged Rambus fraud and racketeering activities late Tuesday went to the jury, which immediately adjourned for the night and will start deliberations at 9 a.m. Wednesday.

The jury will consider two counts of alleged fraud and one count of alleged RICO Act antiracketeering violation against Rambus, stemming from the firm's alleged failure to disclose its synchronous memory patent applications to the industry JEDEC committee while participarting in the drafting of the open SDRAM standard.

Federal Judge Robert Payne told the jury Tuesday if it determined that Rambus committed an actual fraud, it had the option of awarding punitive damages against the firm.

A new wrinkle came up in the trial at the last minute when Rambus charged the statute of limitations had run out on the fraud and RICO charges.

However, Judge Payne instructed the jury that it must determine whether Infineon first learned of Rambus' alleged RICO violation before August 6, 1996, or learned of Rambus' alleged fraudulent actions before Aug. 6, 1998.

If the jury determined that Infineon first learned of the Rambus actions after these dates, he said the statute of limitations would not apply.

If the jury fails to reach a verdict by close of court Wednesday, the trial will be recessed until Tuesday, May 15 because Judge Payne had a prior commitment during the intervening period.