Memory under pressure: the 337-TA-1523 investigation and a 1b DRAM wafer that costs 54 percent more

Memory has become one of the most volatile links in the supply chain. On 23 September the US International Trade Commission (ITC) announced a Section 337 investigation into certain DRAM devices and the products built around them. The case is numbered 337-TA-1523. Netlist filed the complaint on 11 August.

Who is fighting whom

Netlist says Micron Technology, Micron Semiconductor Products, Hewlett Packard Enterprise, Lenovo, Lenovo US and Supermicro infringed four US patents by importing or selling selected DRAM chips, along with servers, computing systems and arrays that contain that memory. The company wants a limited exclusion order and a cease-and-desist order. The ITC notes that opening an investigation does not mean it has found an infringement. The case covers DDR5-generation DIMM modules and the devices that use them.

Netlist is not a memory maker in the classic sense. Its business model has shifted towards monetising intellectual property, and it has a long list of patent disputes behind it. The track record shows how well that works. In 2021 SK Hynix paid 40 million dollars in a settlement and signed a five-year cross-licensing deal. In 2023 a jury awarded about 303 million dollars against Samsung. In 2024 another case with Samsung ended at 118 million dollars, and Micron was ordered to pay 445 million dollars in a separate proceeding.

How the pressure works

Section 337 works differently from an ordinary patent lawsuit. Its force rests on access to the market. Once the ITC finds an infringement, it can block imports and cut a product off from its largest market. Netlist has used that tool before. On 30 September 2025 it filed a complaint over DDR5 DIMM modules and HBM memory against Samsung, Google and Supermicro. On 16 June 2026 it filed another one, naming Nvidia and Broadcom among others. In July the ITC opened proceeding 337-TA-1511.

The other side: prices

Legal pressure is piling on top of supply pressure. According to the Korean research firm Kernel Insight, a 1b DRAM wafer costs 0.654 dollars per square millimetre. A TSMC N2 wafer is priced at 0.424 dollars, 54 percent less, even though N2 requires multiple patterning and EUV lithography. The reason is supply. Building AI servers consumes HBM and high-capacity DDR5 modules, and the three largest memory makers are expanding capacity more slowly than demand is growing. SK Hynix's chief executive argues the AI industry cannot exist without memory. Acer chairman Chen Wei predicts the shortage will not last until 2030, but that prices will keep rising until the middle of 2027. Only then, according to analysts, may the market return to balance.

The strain on production capacity shows in investment plans. In South Korea, SK Hynix and Samsung are competing for land in the Honam and Gwangju semiconductor cluster. Of 826 hectares designated for the industrial park, about 208 hectares can be developed immediately. Nine rounds of talks held from July to September this year dealt mainly with location and pace. The schedule calls for site preparation in 2027, first deliveries of power and water by the end of 2028, and the start of mass production in June 2030. Samsung's Yongin investment is to start earlier, in October 2029.

The economics of memory have shifted in favour of the manufacturers. A 1b DRAM wafer costs 0.654 dollars per square millimetre, 54 percent more than a TSMC wafer on the N2 process, priced at 0.424 dollars. The AI build-out consumes HBM and high-capacity DDR5 modules, and the capacity of the three largest makers cannot keep up with demand. The patent fight with Netlist is only one of the fronts in the battle over margin.