8/27/2003 - Cirrus Logic Inc. (Nasdaq: CRUS) announced that it has settled all outstanding litigation with Western Digital Corporation and its Malaysian subsidiary, Western Digital (M) SDN.BHD. Under the terms of the settlement agreement, Western Digital has agreed to pay Cirrus Logic $45 million on or before Oct. 17, 2003, which is in the company's fiscal 2004 third quarter. The settlement will result in a one-time benefit to the company's net income when the cash is received.
On July 5, 2001, Western Digital and its subsidiary filed a lawsuit against Cirrus Logic in the Superior Court of the State of California, Orange County, in connection with the purchase of read-channel chips from Cirrus Logic, claiming breach of contract and breach of the duties of good faith and faith dealing. On Aug. 20, 2001, Cirrus Logic filed a cross-complaint alleging breach of contract, fraud and negligent misrepresentation.
On Dec. 24, 2001, the trial court granted Cirrus Logic's application for writs of attachment against Western Digital and its subsidiary in the amount of approximately $25 million. Western Digital delivered a letter of credit in the amount of approximately $25 million in substitution for the writ of attachment. This letter of credit will be released following payment of the $45 million to Cirrus Logic.
"We are pleased that the two parties were able to reach this settlement. The cash settlement further enhances our debt-free balance sheet, will enable us to focus on growing our business and eliminate certain legal expenses we have been incurring to pursue this dispute," said David D. French, president and CEO of Cirrus Logic. Cirrus Logic reported total cash of $115.5 million at June 28, 2003.
Upcoming Investor Conferences
Cirrus Logic management will be presenting at the SG Cowen Fall Technology Conference in Boston on Sept. 3 at 3:00 p.m. Eastern Time and the Kaufman Bros. 6th Annual Communications, Media & Technology Conference in New York on Sept. 4 at 4:30 p.m. Eastern Time. Those wishing to listen to management's presentation can hear a live and/or an archived webcast via the company's Web site.
Cirrus Logic Inc.
Cirrus Logic is a premier supplier of high-performance analog, mixed-signal and digital processing solutions for consumer entertainment electronics, automotive entertainment and industrial product applications. Building on its global market leadership in audio ICs and its rich mixed-signal patent portfolio, Cirrus Logic targets audio, video and precision mixed-signal applications in these growing markets. The company operates from headquarters in Austin, Texas, with offices in California, Colorado, Europe, Japan and Asia.
Cirrus Logic and Cirrus are trademarks of Cirrus Logic Inc.
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