IBM and GlobalFoundries Settle Legal Disputes Over Contract and Trade Secrets

IBM and GlobalFoundries announced on Thursday that they have resolved their legal disputes, settling lawsuits involving allegations of contract breaches and trade secret misuse. The confidential settlement, outlined in a joint statement, will enable the two companies to “explore new opportunities for collaboration.”

The lawsuits stemmed from GlobalFoundries’ 2015 acquisition of IBM’s semiconductor manufacturing facilities. In 2021, IBM filed a lawsuit in New York state court, claiming GlobalFoundries had violated a $1.5 billion agreement to produce high-performance chips for the tech giant.

In response, GlobalFoundries, majority-owned by Abu Dhabi’s Mubadala sovereign wealth fund, filed a countersuit in New York federal court in 2023. The company accused IBM of misappropriating its trade secrets and sharing proprietary chipmaking information with competitors, including Intel and Japan’s Rapidus consortium, during collaborative partnerships.

Intel has declined to comment on the settlement, while Rapidus did not respond to inquiries regarding the matter.

GlobalFoundries’ Strategic Positioning

GlobalFoundries has recently solidified its role in the semiconductor industry, benefiting from government incentives aimed at boosting domestic chip production. In November, the U.S. Commerce Department awarded the company a $1.5 billion subsidy to expand its manufacturing facilities in New York and Vermont.

This settlement marks the end of a contentious chapter between the two companies and signals a potential reset in their relationship. Both IBM and GlobalFoundries appear poised to focus on future collaboration as the semiconductor sector faces growing demand and geopolitical pressures.