Monopoly Modern Style: Dan’s Adventures in Patent Litigation Land

1. Monopoly Modern Style:Dan’s Adventures in Patent Litigation Land Daniel M. Dobkin 10/03

2. Caveat Auditor • The statements herein are my own half-baked sloppily-researched completely biased opinions • Nothing herein is to be construed to discredit the many good folks I worked with during this litigation: • Robert Morrill • Chuck Chalmers • Jim Parsons • Bridget Conrad • (? she got married since then, may have changed) • et. al. ….. • all of whom know more than I do about patents and patent law, and none of whom would be likely to support much of my tirade • YOU HAVE BEEN WARNED

3. Overview • What are patents? • ‘526 patent litigation overview • Background: integrated circuits • Background: equipment companies • Background: plasma TEOS • The ‘526 patent • Litigation overview • The Trial and aftermath • Lessons for the audience • Reforms: hope for the best, expect the worst

4. Patents • authority: • US CONSTITUTION, section 8: To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries; • elements • title and abstract: no legal significance • inventor list: important! All creative contributors must be included • drawings: important! Must meet specific standards • specification: core of the patent; describes the invention and practice thereof • claims: what the inventors own • Patent prosecution is all about the claims! • Claims must definitely describe what is owned to enable practitioners to avoid infringement • [fat chance!] • patent must • describe an invention which is novel and useful • invention is a method not just an idea • must enable a person of ordinary skill to practice claimed invention • A patent is a right to sue: • No one can make, use, or sell invention in the US without permission from the inventor(s) • Doesn’t matter who invented it

5. Instant Integrated Circuits • An integrated circuit is transistors connected by wires • Wires must be insulated or they will short • Good insulator must completely cover the wires • Process to make insulator must be FAST (many wafers per hour) insulator wire Images courtesy of Paul Brunemeier via transistor

6. Intermetal Dielectric: Just don’t add water silica • Insulator: silicon dioxide SiO2 (glass) since 60’s • Methods of deposition pre-1986: • Thermal: from silane SiH4 and oxygen O2 • Cheap, simple, moderate temperature, poor coverage • Plasma-assisted: from silane SiH4 and oxygen O2 • More complex; low temperature, poor coverage, better films • Thermal: from TEOS Si(OEt)4 • Complex, high temperature, wonderful coverage • PUT THEM TOGETHER: plasma-assisted TEOS • Obvious? Inventive? Your guess is as good as mine • But none of us count! Only US PTO + courts TEOS Plasma reactor

7. Semiconductor Capital Equipment Industry • Early years (60’s - early 70’s): weren’t none • Large integrated IC fabs built their own equipment • Small companies migrated equipment from optical coating, etc. • By 1980’s: • Cluster of moderate-sized specialized firms, $1M to $250M annual revenues • Divisions of larger firms • Nikon, Canon lithography are main survivors • Mostly in SF Bay Area (Silicon Valley after all) • Tegal • Technics • Silicon Valley Group • Tempress • Applied Materials already dominant by mid-80’s • Founder (McNealy) forced out, Jim Morgan thereafter • $200M annual revenues • ‘Hexode’ plasma etcher, big batch deposition systems key products

8. Anatomy of a modern semiconductor process tool TOP VIEW complex custom parts loadlocks transport chamber process chambers process modules wafer loadports wafer loadlocks transport chamber atmospheric robot Image courtesy of Paul Brunemeier SIDE VIEW

9. Multilevel Metals • By mid-80’s IC industry moving strongly to multiple levels of aluminum for interconnection • Much more difficult problem for insulation (‘interlayer dielectric’) than old days • How to solve? • AMAT • took on problem as part of development of ‘single-wafer’ architecture under Dan Maydan, Sass Somekh, David Wang • Novellus • Small startup founded by AMAT expatriates • Mini-batch deposition architecture, high throughput + good uniformity • AMAT considered acquisition of Novellus as alternative to Maydan effort above [hearsay] • Bob Graham (VP, Marketing at AMAT) later jumped ship to become CEO of Novellus

10. Plasma TEOS • Applied developed several technologies related to dielectrics with good coverage: • Plasma TEOS • Due to Bob Foster or Dan Maydan or ? • Enabling innovation: adjustable electrode spacing, part of the flexible single-wafer architecture • Thermal TEOS at low temperature using ozone • Deposition + sputter etch • Novellus also developed plasma TEOS; key folks were: • Alain Harrus: out of Bell Labs • Evert van de Ven • Technical marketing at AMAT • Left to work at Novellus; worked on PETEOS development

11. The Plot Thickens: US patent 5,362,526 • By 1986 (check date): • Promising early results on PETEOS (and other techniques) • Foster leaves due to differences with Wang • AMAT files application that will later become ‘526 patent • Original application 944492 filed Dec. 19, 1986 • Related application 645999 filed Jan. 23, 1991 • Granted as US 5,362,526 Nov. 8, 1994 • NOTE: not at all uncommon to have many related patents descended from a single basic application • 1] divisionals: PTO often requires separation of big patent into clumps of related claims • 2] continuations: inventors may want to add claims to a patent that has been awarded

12. Competition and Progress • By early 1989 both AMAT and Novellus offered commercial PETEOS deposition systems & processes: • AMAT: • Single-wafer cluster architecture • Electrode spacing about 6 mm • Pressure typically 10 Torr (1 atmosphere = 760 Torr) • Single-frequency excitation, 13.56 MHz • Deposition rate 5000 A/minute • Novellus: • Multi-station mini-batch architecture • 1.5 cm electrode spacing • Pressure typically 3 Torr • Dual frequency: 13.56 MHz + 100 KHz www.novelus.com

13. An Aside: What’s going on? • What is all that process junk for? • Key problem is to get ‘good’ film (= avoid incorporation of water molecules / Si-OH) • Hard to do at low temperature, high rate • DAN’S TAKE: two companies solved the problem in distinctly different ways - • Applied Materials: squeeze plasma into small gap, turn up power and pressure => high rate with good film • Novellus: mini-batch to allow lower rate, add low frequency excitation to improve stress behavior • Each company’s solution did not work with the other’s equipment • [BUT: that’s not how the courts and legal system saw it…]

14. Let’s Litigate! • Nov 94: ‘526 patent awarded, AMAT sues Novellus to stop PETEOS • Novellus countersues on W edge exclusion technique, TEOS vapor delivery approach • Dan retained as 1 of 2 experts for Novellus • AMAT retained 2 experts: • William Oldham, Professor, UC Berkeley • Lithography, epitaxial deposition • Herb Sawin, Professor, MIT • Plasma fundamentals, characterization, processing • WHY TAKE THE CASE? • ‘526 spec: 22 total figures, 12 pages of text: 2 paragraphs on PETEOS process • ‘526 claims: ‘if it works we own it’

15. ‘526 excerpts PETEOS process description PETEOS claim

16. A Patent Lawsuit… • Lawsuit consists of... • Initial sparring: 2-4 months • discovery: depositions, documents, notebooks: 3-6 months • expert reports, depositions: 2 months • Dan: 100’s of hours, 1000 pages of notes • Oldham / Sawin: about 40 hours each [faint memory!], no notes • Dan a turkey or Oldham/Sawin being fed the answers? you be the judge • motions to dismiss etc.: 1-2 months • IF not dismissed AND not settled => trial • ‘Any suit that goes to trial is always a mistake by one side or the other.’ W. Charles Perry

17. Trials and Tribulations • US Federal Circuit under Judge Legg • used to be specialized patent court but no longer • contract murder cases across the way! • AMAT: • van de Ven stole the process (irrelevant but dishonest!) • Evert: did not! • Dan: no idea who is right • Dan’s testimony: • millions of possible processes, spec provides no enabling information • BUT: • no empirical proof • evidence of failure (from inventors’ data) ruled not admissible • Dan’s dirty laundry (similarly useless patent) exposed • ‘Always celebrate before the verdict is in.’ -- Bob Morrill • RESULT: trashed in trial, settle for $80M + ??

18. But was it right? • Did the court get the right answer? • technical: • Dan still believes Novellus and AMAT processes are distinct solutions to the same problem • Should have spend $$ to prove it: AMAT 5000 or R&D reactor • How to make point in court? • social: • assume patent was legit: does society benefit by providing effective monopoly to AMAT? • reduced price competition (Novellus essentially out of PETEOS business) • more money to AMAT: turned into additional R&D OR more lawsuits? • Should markets be awarded to company with first R&D or best product? • what about the benefit of disclosure? • if the inventors don’t understand how can they explain? • Patent application before practical process exists => never truly enabled

19. Lessons for your engineering career • system is about staking claims on new ground, not obviousness or disclosure • fundamentally ambiguous: • Grill = • Ovoid wheeled metal chamber with vents and provision for a fire OR • Parallel metal wires positioned to suspend meat over a flame OR • Charcoal container with heat directed towards food OR… • EVERYONE OWNS THE SAME THING • Everything is patentable • PTO spend a few hours total on each app • Agents can’t possibly be familiar with industrial practice, have no idea what is obvious and what isn’t • YOU have to play the game! • like a protection racket, you can’t not respond when you’re sued so you have to have your own • Suits are always a risk even if you do the work from scratch • Independent invention does not protect from infringement www.amazon.com

20. Reforms: what YOU can do or support • ETHICS: • you as an inventor have an ethical duty to disclose your invention and enable practice without undue experimentation even though the system doesn’t know or care that you did • SYSTEM IMPROVEMENTS: • peer review of spec and claims • for use in litigation • forces spec to be readable, claims to be comprehensible • post-award challenge period • in use in Europe • allows challenge of patents by competitors, helps strip out junk • special masters • help court understand what is going on

21. Unrealistic Reforms: Dreams of Future Passed • PROOF of non-obviousness and enablement • same group of persons of ordinary skill • 1: present with problem, they develop solutions -- did they list the claimed invention? • 2: hand them the patent and prior art (and nothing else), have them practice the patent • ordinary experimentation? success at all? • We the People: • system today is run by and for participants, not public • YOU DON’T NEED TO ACCEPT WHAT THEY SAY! • Their weapon is greed • Remember to balance your interest against society’s benefit • IP is ownership of ideas • Patent = private entity employing government action to constrain others • Monopolies are bad for innovation UNLESS public good is actively served • When in doubt, call it out: default should be to make people free not constrained • your opinion counts if you form one!

22. Acknowledgements • Bruce Mayer • Paul Brunemeier • Maria Swiatek • And you the listeners who stayed awake • If there were any