Verigy Announces that United States District Court Finds Silicon Test Systems, Inc. in Contempt and Extends Duration of Preliminary Injunction

Verigy (NASDAQ:VRGY), a premier semiconductor test company, today announced that on May 20, 2008, the U.S. District Court for the Northern California District of California, San Jose Division, issued an order finding defendants Romi Mayder, Wesley Mayder, Silicon Test Systems, Inc. and Silicon Test Solutions, LLC in contempt of court for violating the Temporary Restraining Order issued by the Court on August 24, 2007. Romi Mayder was employed at Verigy until September 2006. While still employed by Verigy, Mayder began a new business venture and started developing an integrated circuit product. In the most recent ruling, the Court reiterated its conclusion that the defendants’ product, Flash Enhancer, "is substantially based upon Verigy’s trade secrets.” As sanction for the contempt, the Court extended the duration of its preliminary injunction issued on February 29, 2008. The preliminary injunction, which prohibits the defendants from directly or indirectly selling, licensing, distributing, transferring or marketing defendants’ current integrated circuit product, Flash Enhancer, "and any product based on Flash Enhancer” originally had a duration of five months. The duration of the preliminary injunction was extended by an additional four months. Defendants were also ordered to pay Verigy’s attorneys fees in connection with the contempt motion. The preliminary injunction, as extended in duration, is also binding upon anyone in active concert or participation with defendants who receives actual notice of the order. The public version of the injunction order may be viewed at www.ecf.cand.uscourts.gov. "We had clear and convincing evidence that the defendants were engaging in conduct that violated the terms of the temporary restraining order issued in the case,” said Ken Siegel, Verigy’s vice president and general counsel. "We are very pleased that, as we requested, the Court extended the duration of the preliminary injunction as a remedy for defendants ignoring the Court’s earlier order.” The lawsuit began in August 2007 when Verigy sued the defendants for breach of contract, trade secret misappropriation, statutory and common law unfair competition, violation of the Computer Fraud and Abuse Act, Electronic Communications Privacy Act, California Penal Code § 502, breach of duty of loyalty, intentional interference with prospective economic advantage, unjust enrichment, violation of the Lanham Act, and for imposition of a constructive trust. On August 24, 2007, the Court issued a temporary restraining order against Defendants, and that order remained in effect until the preliminary injunction was issued. About Verigy Verigy designs, develops, manufactures, sells and services advanced semiconductor test systems and solutions for the flash memory, high-speed memory and system-on-chip (SoC) markets. Verigy’s scalable platforms are used by leading companies worldwide in design validation, characterization, and high-volume manufacturing test. Advanced analysis tools accelerate design debug and yield ramp processes for Verigy’s customers. Information about Verigy can be found at www.verigy.com.