CREATIVE PATENT LAWSUIT AGAINST AUREAL FINDS PATENT VALID AND ENFORCEABLE WHILE FINDING NON-INFRINGEMENTMILPITAS, CA - December 10, 1999 - Creative Technology Ltd. (NASDAQ: CREAF), and wholly-owned subsidiary EMU, today announced a mixed jury verdict in the case against Aureal Semiconductor. The jury rejected each of the defenses Aureal presented in its efforts to either invalidate or render unenforceable EMU's patent number 5,342,990. The patent was upheld and found to be valid and enforceable.
Remaining Defense of Non-Infringement To Be Appealed
The jury also ruled that Aureal's Vortex and Vortex 2 chips do not infringe this patent. Today's verdict came in the case entitled Creative v. Aureal, US District Court No C-98-0770, filed on February 26, 1998, in the US District Court for the Northern District of California.
"From the beginning of this case we have known that it would be a difficult task to educate a jury concerning the complicated technology represented by Creative's '990 patent," said John Danforth, vice president and general counsel of Creative Labs, Inc., the US subsidiary of Creative Technology Ltd. "Also from the beginning, we have seen extraneous issues raised by Aureal and ultimately rejected. We are pleased that Aureal's remaining defenses concerning the validity of our patent have now been rejected and the patent has been held to be valid and enforceable. We are, of course, disappointed that the jury did not also find infringement. However, Creative plans to seek trial court and appellate court review of this one remaining issue and we believe we have a very strong basis, as a matter of law, to obtain a reversal. We believe that a new trial will focus only on the infringement issue without the numerous other distractions that this jury had to face."
"Based on the evidence we had almost two years ago, we felt that Aureal should have then stopped shipping products that we concluded infringed our patent," said Craig McHugh, president of Creative Labs, Inc. "We are, of course, disappointed that the final resolution of this issue will be deferred again. However, we expect our audio business to continue to grow as projected and we do not believe this deferral will affect that growth."
Creative Technology Ltd. develops, manufactures and markets a wide array of advanced multimedia solutions for the PC, entertainment, education, music and productivity tools
markets. Creative's products are marketed through the OEM, systems integrator and retail channels under a variety of trademarks, including the "Blaster" family name.
With the new Sound Blaster PCI standard, Creative has produced a solution that utilizes a combination of hardware and software for near-perfect compatibility with existing
DOS and Windows titles. Creative's corporate headquarters and primary manufacturing are based in Singapore, with sales, distribution and research and development being carried
out through an extensive, global network of subsidiaries located in North America, Europe, Asia and Africa.