Intel 2008 Annual Report Download - page 114

Table of Contents
INTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
We file U.S. federal, U.S. state, and non-U.S. tax returns. For U.S. state and non-U.S. tax returns, we are generally no longer
subject to tax examinations for years prior to 1996. For U.S. federal tax returns, we are no longer subject to tax examination
for years prior to 2003.
Note 24: Contingencies
Legal Proceedings
We are currently a party to various legal proceedings, including those noted in this section. While management presently
believes that the ultimate outcome of these proceedings, individually and in the aggregate, will not materially harm the
company’s financial position, cash flows, or overall trends in results of operations, legal proceedings are subject to inherent
uncertainties, and unfavorable rulings could occur. An unfavorable ruling could include money damages or, in matters for
which injunctive relief or other conduct remedies are sought, an injunction prohibiting us from selling one or more products at
all or in particular ways. Were unfavorable final outcomes to occur, there exists the possibility of a material adverse impact on
our business, results of operation, financial position, and overall trends. Except as may be otherwise indicated, the outcomes in
these matters are not reasonably estimable.
Advanced Micro Devices, Inc. (AMD) and AMD International Sales & Service, Ltd. v. Intel Corporation and Intel Kabushiki
Kaisha, and Related Consumer Class Actions and Government Investigations
A number of proceedings, described below, generally challenge certain of our competitive practices, contending generally that
we improperly condition price rebates and other discounts on our microprocessors on exclusive or near exclusive dealing by
some of our customers. We believe that we compete lawfully and that our marketing practices benefit our customers and our
stockholders, and we will continue to vigorously defend ourselves. The distractions caused by challenges to our business
practices, however, are undesirable, and the legal and other costs associated with defending our position have been and
continue to be significant. We assume, as should investors, that these challenges could continue for a number of years and may
require the investment of substantial additional management time and substantial financial resources to explain and defend our
position. While management presently believes that the ultimate outcome of these proceedings, individually and in the
aggregate, will not materially harm the company’s financial position, cash flows, or overall trends in results of operations,
these litigation matters and the related government investigations are subject to inherent uncertainties, and unfavorable rulings
could occur. An unfavorable ruling could include substantial money damages and, in matters in which injunctive relief or
other conduct remedies are sought, an injunction or other order prohibiting us from selling one or more products at all or in
particular ways. Were unfavorable final outcomes to occur, our business, results of operation, financial position, and overall
trends could be materially harmed.
In June 2005, AMD filed a complaint in the United States District Court for the District of Delaware alleging that we and our
Japanese subsidiary engaged in various actions in violation of the Sherman Act and the California Business and Professions
Code, including, among other things, providing discounts and rebates to our manufacturer and distributor customers
conditioned on exclusive or near exclusive dealing that allegedly unfairly interfered with AMD’s ability to sell its
microprocessors, interfering with certain AMD product launches, and interfering with AMD’s participation in certain industry
standards-setting groups. AMD’s complaint seeks unspecified treble damages, punitive damages, an injunction requiring Intel
to cease any conduct found to be unlawful, and attorneys’ fees and costs. We have answered the complaint, denying the
material allegations and asserting various affirmative defenses. The discovery cut-off of the AMD litigation is set for May 1,
2009. In February 2007, we reported to the Court that we had discovered certain lapses in our retention of electronic
documents. We then stipulated to a court order requiring us to further investigate and report on those lapses, as well as develop
a plan to remediate the issues. We completed the investigation and provided detailed information to the Court and AMD
throughout 2007 and 2008. The Court also approved our remediation plan, which is now almost completed. The Court granted
our request for an order to permit discovery against AMD in order to investigate its retention practices, including potential
lapses in AMD’s retention of electronic documents. The parties have largely completed document discovery and are in the
process of taking depositions of current and former employees and of third parties. The AMD litigation currently is scheduled
for trial to commence on February 15, 2010.
AMD’s Japanese subsidiary also filed suits in the Tokyo High Court and the Tokyo District Court against our Japanese
subsidiary, asserting violations of Japan’
s Antimonopoly Law and alleging damages in each suit of approximately $55 million,
plus various other costs and fees. Proceedings in those matters are ongoing.
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