IBM, GlobalFoundries in Breach-of-Contract Spat

By Brian Santo, EETimes (June 8, 2021)

IBM is suing GlobalFoundries for breach of contract and is asking for $2.5 billion in damages. IBM made GlobalFoundries aware of the suit, but informed EE Times it hasn’t filed it in court yet, and so is not yet prepared to share it publicly. GlobalFoundries has already filed a petition with the New York State Supreme Court to dismiss the pending suit as meritless.

Back in 2014, IBM was trying to get out of the commercial semiconductor production business. It was shopping some of its aging fabs, but failed to find any buyers, and ended up paying GlobalFoundries $1.5 billion essentially to take them. The two agreed GF would complete the 14 nm IC production process IBM had been working on (which GF did). GlobalFoundries would then supply IBM with 14-nm chips (and so it did), and GF would simultaneously work on the next node. The next node was supposed to be 10nm, but given the competitive situation in the IC manufacturing business, GF decided to skip 10nm and go directly to 7nm. GF says IBM agreed with this decision.

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