Intel Corp was dealt a blow in its continuing legal battle with Intergraph Corp, which alleges patent infringement, anti- competitive behavior and antitrust violations against the chip giant. A federal judge in Alabama denied Intel’s motion for a summary judgement, which would have dismissed the suit, and ruled that a crucial part of Intel’s patent infringement defense wasn’t valid.

US District Judge Edwin Nelson ruled that the disputed patents – which Intergraph acquired when it bought a portion of the Fairchild Semiconductor business from National Semiconductor Corp – were not covered under an existing cross-licensing agreement between Intel and NatSemi. Nelson refuted Intel’s argument that the agreement should exonerate it from infringement claims, ruling that the deal was not valid for the patents of Nat Semi subsidiaries such as Fairchild, which the Judge considers a legally distinct corporation.

Intergraph, the Huntsville, Alabama-based maker of workstations, filed suit against Intel in 1997 over the patent issue. It later added antitrust allegations, claiming that in the wake of the patent dispute Intel used its monopoly position to harm Intergraph by withholding advance product information that was vital to its business. Intel says it plans to appeal Judge Nelson’s ruling and asserts that it has other defenses against the allegations. Unless the appeal is successful, Intel will not be able to raise the issue of the cross-licensing agreement in court. The case is scheduled to go to trial in Alabama next February. á