Under terms of the agreement, Intel (INTC) will pay AMD (AMD) $1.25 billion (nearly a quarter of AMD’s $4.46 billion market cap) and agree to “abide by a set of business practice provisions” presumably crafted to temper Intel’s allegedly anticompetitive practices. Here are details of the agreement:

Business Practices Provisions Prohibit Intel From:

• Offering inducements to customers in exchange for their agreement to buy all of their microprocessor needs from Intel, whether on a geographic, market segment, or any other basis (Section 2.1.1.a)
• Offering inducements to customers in exchange for their agreement to limit or delay their purchase of microprocessors from AMD, whether on a geographic, market segment, or any other basis (Section 2.1.1.b)
• Offering inducements to customers in exchange for their agreement to limit their engagement with AMD or their promotion or distribution of products containing AMD microprocessors, whether on a geographic, channel, market segment, or any other basis (Section 2.1.2a-b)
• Offering inducements to customers in exchange for their agreement to abstain from or delay their participation in AMD product launches, announcements, advertising, or other promotional activities (Section 2.1.2.b)
• Offering inducements to customers or others to delay or forebear in the development or release of computer systems or platforms containing AMD microprocessors, whether on a geographic, market segment, or any other basis (Section 2.2.2 and 2.1.2)
• Offering inducements to retailers or distributors to limit or delay their purchase or distribution of computer systems or platforms containing AMD microprocessors, whether on a geographic, market segment, or any other basis (Section 2.2.1)
• Withholding any benefit or threatening retaliation against anyone for their refusal to enter into a prohibited arrangement such as the ones listed above.

In return, AMD will drop all its pending litigation against the company and pull out of regulatory complaints worldwide. Finally, the two rivals will enter into a five-year patent cross-licensing agreement.

In a joint statement, the companies said, “While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development.”

Interesting. Clearly, AMD CEO Dirk Meyer’s earlier comments about the ratification of its complaints about Intel’s business practices and the company’s hope for a future in which AMD’s “ability to succeed as a business is really determined by the quality of our products and customer relationships” was quite prefigurative.

During a call to discuss the settlement, Meyer said the accord marks the beginning of a new era, one that changes the game for AMD. “It is an important milestone for us, for our customers, our partners, and most importantly–for consumers and businesses worldwide,” Meyer said.

“It is the culmination years of litigation and regulatory engagement, and we are optimistic that it will usher a new era for our industry,” the CEO continued, further noting that change may not be immediate. “We recognize that it will take time for people to understand how the operating conditions in processor business have changed–but make no mistake–they have changed….We look forward to healthy competition with the mutual respect one would expect between world-class competitors.”

It is unclear if the settlement will affect the antitrust suit brought against Intel by New York Attorney General Andrew Cuomo last week as Cuomo hasn’t yet commented. But the European Union says it will not change its decision in May to fine Intel a record $1.5 billion for anticompetitive behavior.

“The European Commission takes note that Intel and AMD have settled all their litigation and that Intel is paying AMD compensation of one-and-quarter billion dollars,” said an EC spokesman. “But Intel has an ongoing obligation to comply with the commission’s antitrust decision and with EU competition law. The commission continues to vigorously monitor Intel’s compliance with its obligations under the EU antitrust decision.”

Kai-Fu Lee’s uneventful departure from Google to start a Beijing incubator really belies the spectacle that attended the beginning of his tenure at the search giant.

Lee’s train-hopping from Microsoft (MSFT) to Google (GOOG) back in 2005 touched off a five-month pitched battle marked by all manner of inanities. Among them was this account of Microsoft CEO Steve Ballmer’s now-infamous alleged chair-tossing tantrum told by former Microsoft Distinguished Engineer Mark Lucovsky:

Prior to joining Google, I set up a meeting on or about November 11, 2004 with Microsoft’s CEO Steve Ballmer to discuss my planned departure…At some point in the conversation, Mr. Ballmer said: “Just tell me it’s not Google.” I told him it was Google.

At that point, Mr. Ballmer picked up a chair and threw it across the room hitting a table in his office. Mr. Ballmer then said: “F–king Eric Schmidt is a f–king p–sy. I’m going to f–king bury that guy, I have done it before, and I will do it again. I’m going to f–king kill Google.”

Thereafter, Mr. Ballmer resumed trying to persuade me to stay…Among other things, Mr. Ballmer told me that “Google’s not a real company. It’s a house of cards.”

And there were others as well. Certainly, the sourcing of some of Microsoft’s legal docs was amusing. As I wrote at the time:

Kai-Fu Lee may be a top-drawer research engineer, but his understanding of the mechanics of Microsoft’s desktop environment leaves a bit to be desired. Turns out Microsoft recovered Lee’s employment contract with Google, which figures prominently in its suit against the search leader (see “And, if you’re beaten by Microsoft thugs, our generous health plan will cover you”), from the “recycle bin” of one of Lee’s computers. Odd that Lee would choose to browse offers from his employer’s rivals on his work computer. Odder still that having done so, he would neglect to scrub them with a secure erase program. Clearly, he must have been a bit lightheaded after learning of Google’s promise to allow his stock options in the company to vest even if he was unable to start work for a year.

Then there was Lee’s testimony about a meeting with Bill Gates, during which the Microsoft chairman blew his top, shouting that the Chinese people and the Chinese government had “f—ked” Microsoft.

And, finally, there were the videotaped depositions, like one from Ballmer that included this great bit:

Ballmer: “Kai-Fu had a–a distinct commitment and responsibility on behalf of the company for being the senior executive here in Redmond, with responsibility for godfathering, shepherding all of our R&D activities in China. It’s a structure we also use for India. We have a senior executive with knowledge of India be the R&D godfather for India, encourage work to go there, shepherd, and–and mentor people in the area. Kai-Fu had that broad, important responsibility for China.”

Deposing lawyer: “This term, ‘godfather’–is that an official title within the Microsoft organization?”

Hard to believe Kai-Fu Lee’s tenure at Google China ended with such a whimper, although there are many quiet rumblings of trouble he had with Google’s top execs in Silicon Valley, given the bang it began with.

But it did. And here endeth the history lesson.

In August 2007, just after former Apple exec Jon Rubinstein joined Palm, Apple CEO Steve Jobs warned Palm CEO Ed Colligan against poaching his company’s employees. “We must do whatever we can to stop this,” he said, according to communications reviewed by Bloomberg. Colligan declined. “Your proposal that we agree that neither company will hire the other’s employees, regardless of the individual’s desires, is not only wrong, it is likely illegal,” he told the Apple CEO, noting–ironically–that Cupertino had hired away some two percent of Palm’s workforce as it began developing the iPhone.

And that’s proven a wise move. Today, the U.S. Department of Justice is investigating just such gentleman’s agreements as a collusive restraint on trade. And Palm (PALM) and Apple (AAPL) are sparring over intellectual property and the Pre handset, which Apple claims “falsely pretends to be an iPod.” How convenient for Palm that these communications should emerge now when its Cupertino rival is giving it such a hard time. And such a distraction for Apple legal….

Of course, Jobs was right to worry. Within a year of his warning to Colligan, Palm hired away Mike Bell and Lynn Fox, Apple VP of CPU software in the Macintosh hardware division and head of Mac PR respectively, among others hired later. And within two years, Palm debuted a new handset that some consider a worthy rival to the Apple iPhone.

Kindle 2’s experimental text-to-speech feature is legal: no copy is made, no derivative work is created, and no performance is being given. Furthermore, we ourselves are a major participant in the professionally narrated audiobooks business through our subsidiaries Audible and Brilliance. We believe text-to-speech will introduce new customers to the convenience of listening to books and thereby grow the professionally narrated audiobooks business. Nevertheless, we strongly believe many rightsholders will be more comfortable with the text-to-speech feature if they are in the driver’s seat.

Therefore, we are modifying our systems so that rightsholders can decide on a title by title basis whether they want text-to-speech enabled or disabled for any particular title. We have already begun to work on the technical changes required to give authors and publishers that choice. With this new level of control, publishers and authors will be able to decide for themselves whether it is in their commercial interests to leave text-to-speech enabled. We believe many will decide that it is.

The move comes on the heels of a meandering New York Times editorial in which Roy Blount Jr., president of the Authors Guild, argued that the Kindle’s roboticized nondramatic book readings are a threat to the audio book market.

We like competition, as long as they don’t rip off our IP, and if they do, we’re going to go after anybody that does….We will not stand for having our IP ripped off and we’ll use whatever weapons we have at our disposal [to make sure that doesn't happen]. I don’t know that I can be more clear than that.”

– Apple COO Tim Cook’s on the company’s iPhone intellectual property

Turns out that when Apple (AAPL) COO Tim Cook said the company would use “whatever weapons we have at our disposal” to pursue anyone who “rips off” Apple’s iPhone intellectual property, he had a very specific weapon in mind: United States Patent #7,479,949. Awarded just days before Cook made that statement, the vast 358-page patent describes the touchscreen, graphical user interface and technologies that define the iPhone user experience, including at least one that may define an element of the Palm (PALM) Pre’s as well. From the patent abstract:

A computer-implemented method for use in conjunction with a computing device with a touch screen display comprises: detecting one or more finger contacts with the touch screen display, applying one or more heuristics to the one or more finger contacts to determine a command for the device, and processing the command. The one or more heuristics comprise: a heuristic for determining that the one or more finger contacts correspond to a one-dimensional vertical screen scrolling command, a heuristic for determining that the one or more finger contacts correspond to a two-dimensional screen translation command, and a heuristic for determining that the one or more finger contacts correspond to a command to transition from displaying a respective item in a set of items to displaying a next item in the set of items.

Also described in the patent, a gesture area separate from the iPhone touchscreen UI itself:

In some embodiments, in addition to the touch screen, the device 100 may include a touchpad (not shown) for activating or deactivating particular functions. In some embodiments, the touchpad is a touch-sensitive area of the device that, unlike the touch screen, does not display visual output. The touchpad may be a touch-sensitive surface that is separate from the touch screen 112 or an extension of the touch-sensitive surface formed by the touch screen.

A touch-sensitive area of the device that, unlike the touchscreen, does not display visual output. Hmm. That sounds awfully familiar, doesn’t it? Where have I heard that before… Oh, I know, in Palm’s announcement of the Pre.

Palm Pre features include the following:

…Gesture area, which enables simple, intuitive gestures for navigation”

Makes you wonder what’s going on in the bowels of Apple legal right now, doesn’t it? Palm legal, too. The company could certainly challenge the validity of the patent if it chose to.

PREVIOUSLY:

• Palm to Apple: Bring It
• Apple COO: “We Will Not Stand for Having Our IP Ripped Off”

On information and belief, PSYSTAR alleges that APPLE intentionally embeds code in the Mac OS that causes the Mac OS to malfunction on any computer hardware system that is not an Apple-Labeled Computer Hardware System. Upon recognizing that a computer hardware system is not an Apple-Labeled Computer Hardware System, the Mac OS will not operate properly, if at all, and will go into what is colloquially known as ‘kernel panic.’

PSYSTAR is informed and believes, and thereon alleges, that APPLE is engaged in anticompetitive conduct that prevents the proper operation of the Mac OS on any computer hardware system that is not an Apple-Labeled Computer Hardware System–a Mac OS Capable Computer Hardware System–thereby forcing customers of the Mac OS to purchase–and only purchase–an Apple-Labeled Computer Hardware System if they wish to have the Mac OS operate sans kernel panic or an infinite loop.”

That’s an intriguing allegation. Risky though, since it’s also an admission that Psystar has circumvented the technological copyright-protection measures built into OS X, just as Apple claims in its amended complaint against the company. Apple contends Psystar has done so illegally, in violation of The Digital Millennium Copyright Act. Psystar says that’s impossible because the kernel panic-forcing code at issue here isn’t a copyright-protection measure.

Who’s right? Who knows? But if it’s Apple, then Psystar presumably is guilty of circumventing Apple’s copyright protection systems under the DMCA. And that’s a felony, because Psystar profited from the circumvention.

“I am extending the temporary restraining order because I’m not satisfied in the fact that this technology is not in violation,” Patel explained. “There are serious questions about copyright violations. There are questions about violations of the (Digital Millennium Copyright Act), and violations of these companies’ agreement.”

PREVIOUSLY:

• Rent. Rip. Restraining Order.
• StealDVD? Well, You Were Asking for It…
• Sue. Rent. Rip. Return.
• Rent. Rip. Return.

Due to recent legal action taken by the Hollywood movie studios against us, RealDVD is temporarily unavailable. Rest assured, we will continue to work diligently to provide you with software that allows you to make a legal copy of your DVDs for your own use.”

Good luck with that, folks.

As I’ve noted here before, RealDVD is a nice idea–a $30 software program that easily copies entire DVDs, right down to the menus, bonus features and cover art. And it does so in an ostensibly legal way. What it doesn’t do, though, is prohibit users from ripping DVDs that they rent. Effectively, users are on the honor system, which isn’t exactly a Hollywood-approved DRM scheme.

Anyway, here it is in all its keep-your-head- in-the-sand glory.

yahoos,

today carl icahn announced his intent to nominate a slate of 10 directors to take control of our board of directors at this year’s annual meeting. we sent him a letter in response, which we made public in a press release. i’m attaching a copy of that press release, including the full text of our letter, and you should read it carefully.

we always want to hear the views of our stockholders, but you should know that mr. icahn’s letter reflects a significant misunderstanding of the facts about the microsoft proposal and the diligence with which our board evaluated and responded to that proposal. we believe our board has the independence, knowledge, experience and commitment to maximize value for all of our stockholders. yahoo is a great company with a truly unique set of highly valuable assets that is growing, profitable and executing well on its strategic plan to enhance our leadership position in online advertising. our solid results for the first quarter of 2008 are a testament to this.

today’s events will undoubtedly draw a lot of media attention and there will be lots of speculation about what happens next for yahoo. i ask all of you to put aside the rumors and speculation and stay focused on the business at hand and what we do best — transforming the online experiences of our users, advertisers, publishers and developers.

i know you all have a lot of questions and so i’ve also attached some faqs that will address some of your questions. as we’ve said before we’ll do our best to continue to update you as new information becomes available. thank you again for your continued hard work as we work together to make yahoo a stronger leader in the online marketplace and an even better company.

jerry

FAQ

Can stockholders nominate directors to the board?
Stockholders, as equity owners of the Company, have the ability to nominate one or more directors for election to a board at the Company’s annual meeting as long as they comply with the requirements contained in our bylaws. Under our bylaws, today was the last day that a stockholder could nominate a candidate for director.

How long will all this take?

We can’t speculate on how events will develop at this time, but we plan to hold our annual meeting in a couple of months. I’d ask all of you to stay focused on the business at hand and what we do best — transforming the experiences of our users, advertisers, publishers and developers, all while enhancing our leadership position in the online marketplace.

What’s our next step?
We will file preliminary proxy materials with the SEC that will describe the matters to be voted on, including the Company’s nominees for election to the board, and the board’s recommendation. Once those materials are cleared by the SEC, we will mail them to our stockholders.

In the meantime, we should remain focused on doing what we do best — transforming the experiences of our users, advertisers, publishers and developers, all while enhancing our leadership position in the online marketplace.

We will continue to update you as information becomes available but please remember that we are subject to various legal restrictions on what we can say and when we can say it.

What can employees do?
We ask you to continue to put aside all rumors and speculation you may be hearing. None of us should allow external reports to shift our focus away from doing what we do best — transforming the experiences of our users, advertisers, publishers and developers, all while enhancing our leadership position in the online marketplace.

The judgment is believed to be the largest anti-spam award to date. Not that it really matters, because MySpace (NWS) is unlikely to collect it. Wallace–who was by some estimates responsible for 80% of the spam on the Net back in his heyday–has rarely paid the judgments against him. Moreover, he has a bad habit of disappearing at the first sign of legal trouble.

And that appears to be exactly what he’s done here. Because the $230 million award given MySpace in this case is a default judgment meted out after Wallace failed to appear in court. “It is … a defendant’s responsibility to respond to discovery, obey court orders and avoid dilatory tactics,” the court wrote in its order. “Taking all of the above factors into account, a default is appropriate. The court finds that Wallace’s noncompliance is due to willfulness, fault or bad faith. … Wallace has had every opportunity to avoid the sanction of default. (He) has never provided any explanation for his behavior to the court.”