Crucial 2014 Annual Report Download - page 27

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Qimonda
On January 20, 2011, Dr. Michael Jaffé, administrator for Qimonda insolvency proceedings, filed suit against MTI and
Micron Semiconductor B.V., our Netherlands subsidiary ("Micron B.V."), in the District Court of Munich, Civil Chamber. The
complaint seeks to void under Section 133 of the German Insolvency Act a share purchase agreement between Micron B.V. and
Qimonda signed in fall 2008 pursuant to which Micron B.V. purchased substantially all of Qimonda's shares of Inotera
Memories, Inc. (the "Inotera Shares"), representing approximately 55% of our total shares in Inotera, and seeks an order
requiring us to retransfer those shares to the Qimonda estate. The complaint also seeks, among other things, to recover
damages for the alleged value of the joint venture relationship with Inotera and to terminate under Sections 103 or 133 of the
German Insolvency Code a patent cross-license between us and Qimonda entered into at the same time as the share purchase
agreement.
Following a series of hearings with pleadings, arguments and witnesses on behalf of the Qimonda estate, on March 13,
2014, the Court issued judgments: (1) ordering Micron B.V. to pay approximately $1 million in respect of certain Inotera
shares sold in connection with the original share purchase; (2) ordering Micron B.V. to disclose certain information with respect
to any Inotera Shares sold by it to third parties; (3) ordering Micron B.V. to disclose the benefits derived by it from ownership
of the Inotera Shares, including in particular, any profits distributed on such shares and all other benefits; (4) denying
Qimonda’s claims against Micron Technology for any damages relating to the joint venture relationship with Inotera; and (5)
determining that Qimonda's obligations under the patent cross-license agreement are cancelled. In addition, the Court issued
interlocutory judgments ordering, among other things: (1) that Micron B.V. transfer to the Qimonda estate the Inotera Shares
still owned by it and pay to the Qimonda estate compensation in an amount to be specified for any Inotera Shares sold to third
parties; and (2) that Micron B.V. pay the Qimonda estate as compensation an amount to be specified for benefits derived by it
from ownership of the Inotera Shares. The interlocutory judgments have no immediate, enforceable effect on us, and,
accordingly, we expect to be able to continue to operate with full control of the Inotera Shares subject to further developments
in the case. We have filed a notice of appeal, and the parties have submitted briefs to the appeals court. A hearing on the matter
is scheduled for February 2, 2015.
We are unable to predict the outcome of the matter and therefore cannot estimate the range of possible loss. The final
resolution of this lawsuit could result in the loss of the Inotera Shares or equivalent monetary damages, unspecified damages
based on the benefits derived by Micron B.V. from the ownership of the Inotera Shares, and/or the termination of the patent
cross-license, which could have a material adverse effect on our business, results of operation or financial condition. As of
August 28, 2014, the Inotera Shares had a carrying value for purposes of our financial reporting of $505 million and a market
value of $2.06 billion.
(See "Item 1A. Risk Factors.")
ITEM 4. MINE SAFETY DISCLOSURES
Not Applicable.