In a ruling this morning, US District Court Judge Joseph A. Farnan, Jr., has accepted the findings of the Special Master appointed to oversee the discovery of documents in AMD's antitrust case against Intel, and is ordering Intel to produce documents that may show that company entered into exclusivity agreements with retailers in Germany, the effect of which was to limit AMD's ability to upgrade its fabrication facilities in Texas, thereby hurting US customers.
Last month, Judge Farnan ruled that much of AMD's original case is impossible to prove under current US antitrust law, which restricts actionable conduct to business transactions made here, with the exception of some export arrangements. But on December 15, Special Master Vincent Poppiti found that, as long as AMD intends to proceed with its plans to argue why the remainder of its case is viable, it has the right to ask that the court compel Intel to produce relevant documents that may help it bolster its case, even if the judge throws out the rest of the case later.
As Poppiti wrote, "To prove its export commerce claims, AMD must introduce evidence of exclusionary conduct on the part of Intel that foreclosed opportunities for AMD to sell its American-made microprocessors to foreign customers. Accordingly, the Special Master concludes that the Foreign Conduct Discovery Materials are reasonably calculated to lead to the discovery of exclusionary conduct that would support a foreclosure claim in connection with the sale of American-made x86 microprocessors abroad."
Intel itself may have unwittingly made it possible for AMD to seek these documents, by having been unwilling in prior proceedings to provide evidence that it either has or doesn't have monopoly power, either regionally or globally. As Poppiti noted, Intel's intention is part of its own claim that it's not a monopoly anywhere, but a competitor, thus placing the burden upon AMD to prove that Intel has monopoly power - a statement its own marketing claims refute. If AMD can't prove Intel is a monopoly, it doesn't have a case.
"To prove monopoly power," Poppiti wrote, "AMD must show that Intel has the power to control prices or exclude competition...As Intel is unwilling to stipulate to having monopoly power, AMD is entitled to discover information relevant to Intel's ability to control prices and/or exclude competition." In other words, had Intel not made such a big fuss about it in the first place, the whole issue might have blown over.
Poppiti mentioned the Justice Dept.'s 1999 case against Microsoft, which had apparently been cited in Intel's defense. There, among the many determinations of an appeals court was one that said that actions by one company that negatively impact only one or two competitors, doesn't necessarily imply the exclusionary actions of a monopoly in the market. "Typically, harm to one or more competitors will not suffice," Poppiti wrote. "However, if there is only one other competitor, harm to such competitor may suffice."
To that end, Poppiti noted, AMD could very well be capable of presenting a case for itself alleging Intel's attempt to monopolize, which under federal law, "occurs when a competitor, with a dangerous probability of success, engages in anti-competitive practices the specific design of which are, to build a monopoly or exclude or destroy competition." With that citation of US code, Poppiti may have opened a window for AMD to prove its case without contradicting its own marketing claims.
But that doesn't seem to be the window for which AMD is headed, as "attempting to monopolize" doesn't sound like the tone of comments coming from its counsel today. "This case remains firmly focused on the worldwide misbehavior of a global monopolist," AMD's executive vice president for legal affairs, Thomas McCoy, stated this afternoon. "This ruling also removes any basis for Intel or its foreign customers to withhold evidence of Intel's exclusion, regardless of where it occurred. We will proceed vigorously to prove that Intel abuses its global monopoly power by limiting or excluding competition, which ultimately hurts consumers worldwide."