The United States Bankruptcy Court for the Northern District of California has issued a decision in favor of graphics chip maker Nvidia that should put to rest allegations that the company underpaid for the assets of now-defunct rival 3dfx Interactive.
It may seem like ancient history now, but in the late 1990’s, 3dfx Interactive’s graphic cards were the ones to beat. The company, founded in 1994, created and licensed graphics cards for Windows PCs and Macs that enabled computers to display detailed 3D graphics using an Application Programming Interface (API) called Glide.
3dfx Interactive made numerous product development and management stumbles in the late 1990s and 2000 that would ultimately lead to its demise. In late 2000, Nvidia announced that it would acquire the assets of 3dfx in a $70 million cash and $1 million stock swap deal. That deal also put to rest litigation 3dfx had pending against Nvidia alleging trademark and patent infringement.
3dfx’s creditors later filed suit against Nvidia in an attempt to obtain damages in excess of $100 million. The court found in Nvidia’s favor, and said that the trustee’s valuation theory “is simply not credible.”