Nassda Clarifies Federal and State Litigation Developments

SANTA CLARA, Calif.--(BUSINESS WIRE)--Jan. 10, 2003--Nassda Corporation (Nasdaq:NSDA) today commented on recent rulings and opinions in its litigation with Synopsys, Inc. During the last several weeks, the courts issued orders in the cases in California federal and state courts.

In the federal action, the U.S. Patent Office recently determined that prior art relating to one of Synopsys' products, which was not previously disclosed to or considered by the Patent Office, created a "substantial" question as to whether the patent which Synopsys is asserting against Nassda (U.S. Patent No. 5,878,053) is valid. Based on this determination, the Patent Office has decided to "reexamine" the patent. Because the Patent Office could narrow, invalidate or otherwise change Synopsys' patent claims during the reexamination process, the Federal Court recently issued an order staying Synopsys' patent infringement action against Nassda in its entirety until the reexamination process has been completed.

With respect to the California state court action, the discovery referee recently issued orders, some of which were in favor of Nassda, some of which were not. Nassda disagrees with certain of the discovery referee's rulings. These rulings created "rebuttable presumptions" in favor of Synopsys on certain evidentiary issues to sanction Nassda for erasure of certain computer files requested in discovery by Synopsys. These rulings mean that Nassda must prove at trial that it did not take or use Synopsys' source code or other confidential information, rather than the usual requirement for Synopsys provide such proof. However, none of these rulings resolves any of the claims made by Synopsys in the case and the trial judge or jury can reach their own conclusions based upon the evidence presented at trial. Nassda will present evidence at trial and show that it did not take or use Synopsys' trade secrets.

Synopsys' attorneys have had access to Nassda's proprietary source code to HSIM for over a year, including documentation detailing the creation of Nassda's HSIM product, and have not identified to Nassda or the Court any specific evidence showing that anyone at Nassda used Synopsys' source code.

"Contrary to recent reports in the press, no Synopsys source code has been found on any Nassda computer," said An-Chang Deng, President. "No Synopsys source code has been located within Nassda or in its products because Nassda and its founders did not take or use it. Nassda intends to vigorously defend itself and believes that the evidence at trial will show that Synopsys' claims against it lack any merit."

"Nassda is a technology leader, not a follower," said Sang Wang, CEO. "Nassda's technologies are truly innovative and not based on any competitor's proprietary technology. This is demonstrably true based upon any fair comparison of Nassda's products against its competition. The industry continues to adopt Nassda's new-generation capabilities as its nanometer solutions because Nassda's technology is truly innovative, not derivative. Synopsys' decision to use litigation and marketing tactics instead of innovations to compete will ultimately disappoint its users."

About Nassda

Nassda Corporation (Nasdaq:NSDA) is a fast-growing provider of full-chip circuit verification software for complex nanometer semiconductors. Headquartered in Santa Clara, California, the company develops and markets simulation and analysis solutions for advanced ICs, especially for analog, mixed signal, memory, system-on-chip and high-speed digital designs. Nassda's products enable first silicon success, and improve product quality and production yield for its consumer, communication, computer, and memory customers. The company has sales and distribution offices throughout the world. For more information about Nassda, please visit the company's website at http://www.nassda.com.

Forward Looking Statements

This press release contains forward-looking statements regarding the outcome of the litigation between Nassda and Synopsys that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally preceded by words that imply a future state, such as "expects" or "anticipates," or that imply that a particular future event or events will occur, such as "will," "remain," "may," or the negative of these terms. Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty, including without limitation, the outcome of pending and future motions and other court proceedings, as well as the results of any trial or appeal. These risks, uncertainties and other factors may cause the outcome of any motion, proceeding or case to differ materially from those expressed or implied by the forward-looking statements.

Forward-looking statements are only predictions and the actual events or results may differ materially. Nassda cannot provide any assurance that its future results will meet expectations. In addition, historical information should not be considered a predictor of future performance. Neither Nassda nor any other person assumes responsibility for the accuracy and completeness of these forward-looking statements. Nassda disclaims any obligation to update information contained in any forward-looking statement.

For additional information and considerations regarding the risks faced by Nassda, see its Annual Report on Form 10-K, as filed with the Securities and Exchange Commission.

Nassda is a registered trademark of Nassda Corporation.

CONTACT: Nassda Corporation
             Graham Bell, 408/562-9168
             gbell@nassda.com
                or
             Lee Public Relations
             Gloria Nichols, 650/363-0142        
             gloria@leepr.com