Nvidia filed a countersuit against Intel for breach of contract yesterday, in which it alleged Chipzilla had made misleading statements in an effort to weaken the graphics chipmaker's licensing rights.

The suit is also seeking to kill off Intel's licence to Nvidia's graphic processing and 3D computing patents.

The move was a response to Intel's decision to sue Nvidia last month. The world's number one chip maker claimed in a lawsuit filed in a court in Delaware that its latest microprocessors weren't covered under a 2004 cross-licensing agreement with Nvidia.

Intel alleged that the four-year-old chipset licence deal with Nvidia does not extend to its future generation processors - including its Nehalem processor - that come loaded with an integrated memory controller.

Nvidia claimed in its countersuit that Intel has "manufactured" the licensing row as part of a "calculated strategy to eliminate Nvidia as a competitive threat."

The company also insisted that it remained fully licensed to continue making products that interact with Intel microprocessors.

An Intel spokesman told Reuters that Chipzilla had "been trying multiple times, multiple ways to find a way to settle the argument" with Nvidia before deciding to file the lawsuit.

"Nvidia did not initiate this legal dispute. But we must defend ourselves and the rights we negotiated for when we provided Intel access to our valuable patents," said Nvidia's boss Jen-Hsun Huan. "Intel's actions are intended to block us from making use of the very license rights that they agreed to provide." ®

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