Initial Determination in Patent Infringement Investigation Finds MediaTek Infringes Zoran Patent

Zoran Moves to Amend District Court Complaints to Add New Patents

Sunnyvale, Calif. - May 16, 2005 - Today, Administrative Law Judge Paul J. Luckern of the United States International Trade Commission issued an Initial Determination finding that United States Patent No. 6,584,527 is infringed by MediaTek and a number of its customers. The Administrative Law Judge also determined that this patent is valid and enforceable.

The Initial Determination finds that certain MediaTek chips and optical drive products of Artronix Technology, Inc., ASUS Computer International, Inc., ASUSTek Computer, Inc., EPO Science & Technology Co., Inc., LITE-ON Information Technology Corp., Micro-Star International Co., Ltd., MSI Computer Corp., TEAC Corporation, TEAC America, Inc., and Ultima Electronics Corporation infringe United States Patent No. 6,584,527, which relates to optical drive controller design. The Administrative Law Judge recommended that the International Trade Commission issue a limited exclusion order against the importation of these products into the United States.

The Initial Determination is subject to review by the International Trade Commission, which is expected to issue its final decision on or before September 14, 2005. The details of the Administrative Law Judge's decision have been designated confidential.

Zoran Corporation also filed a motion on May 6, 2005, to amend its related patent infringement complaints in its lawsuits in the United States District Court in San Jose, California against MediaTek, Inc. and seventeen other defendants. The proposed amended complaints seek both money damages and an injunction to stop the importation and sale of MediaTek and the other defendants' products that infringe two patents owned by Zoran. If the motion is successful, the total number of patents asserted in these lawsuits would increase from three to five.

The proposed amended complaints allege that MediaTek, Inc., Artronix Technology, Inc., ASUS Computer International, Inc, ASUSTek Computer, Inc., Audiovox Corporation, Changzhou Shinco Digital Technology Co., Ltd., EPO Science & Technology Co., Inc., Initial Technology, Inc., LITE-ON Information Technology Corp., Micro-Star International Co., Ltd., Mintek Digital, Inc., MSI Computer Corp., TEAC Corporation, TEAC America, Inc., Shinco International Av Co., Ltd., Terapin Technology Pte., Ltd., Teraoptix L.P. D/B/A Terapin Technology, and Ultima Electronics Corporation products infringe United States Patent No. 5,870,363, which relates to optical drive controller design and that MediaTek, Audiovox Corporation, Changzhou Shinco Digital Technology Co., Ltd., Initial Technology, Inc., Mintek Digital, Inc., Shinco International AV Co., Ltd., Terapin Technology Pte., Ltd. Corporation and Teraoptix L.P. D/B/A Terapin Technology products infringe U.S. Patent No. 6,456,292, which relates to highlighting effects in multimedia data.

The proposed amendments would bring the total number of patents asserted in the lawsuits against MediaTek and its customers to five. Zoran's existing lawsuits include claims for infringement of United States Patent Nos. 6,584,527, 6,546,440, and 6,466,736.

Zoran Corporation, based in Sunnyvale, California, is a leading provider of digital solutions in the growing digital entertainment and digital imaging markets. With two decades of expertise developing and delivering digital signal processing technologies, Zoran has pioneered high-performance digital audio and video, imaging applications, and Connect and Share technologies for the digital home. Zoran's proficiency in integration delivers major benefits for OEM customers, including greater capabilities within each product generation, reduced system costs, and shorter time to market. Zoran-based DVD, digital camera, DTV, multimedia mobile phone and multifunction printer products have received recognition for excellence and are now in millions of homes and offices worldwide. With headquarters in the U.S. and operations in Canada, China, England, Germany, Israel, Japan, Korea and Taiwan, Zoran may be contacted on the World Wide Web at www.zoran.com or at 408-523-6500.