Monday, February 1, 2010

Infineon and the Wild West

Klaus Wucherer has been on the board of Infineon, a German based chip maker, for ten years, and he has been designated to step into the chairman's office upon the retirement of the current chairman, Max Dietrich Kley, at an upcoming shareholders' meeting.

But Wucherer has run into some trouble. Several foreign shareholders, led by the UK based investment company Hermes, have complained that replacing Kley with Wucherer is simply a matter of keeping the old guard in place, where what is needed at Infineon is a more sweeping change.

Willi Berchtold, the chief financial officer of ZF Friedrichshafen AG, is the favored next chairman among those who want such change.

The weekend edition of the Financial Times reports (p. 9) that Wucherer has been travelling around the US, where a lot of Infineon's largest shareholders are to be found, seeking support. He has also sought to shore up support for himself by agreeing that he will only serve a single year as chairman -- the dissidents are presumably going to be bought off with the promise that they'll get their desired root-and-branch change soon enough.

This attracts my attention in part because Infineon has played a colorful part in the sparring in recent years over intellectual property in the semiconductor marketplace. In 2000, Rambus Inc. filed a lawsuit against it on the grounds of patent infringement, this was only shortly after Infineon's (1999) split-off from Siemens. The Rambus claim was kicked about through the trial and appellate courts for awhile, but then the claim was dismissed in March 2005, in part because the trial judge decided that Rambus had shredded key documents prior to court hearings.

Really? They felt their case was so weak they had to resort to the shredder? The whole issue of IP rights in the semiconductor industry has a Wild-West feel to it, with lawyers playing the stand-in role for six shooters and courts playing the OK Corral. I'll come back to this another day, but in the meantime I have to say I feel some sentimental fondness for the the incumbents at Infineon, because they survived that shootout in Tombstone and didn't end up in Boot Hill then.

No comments: