In a strange turn of events, S3 and NVIDIA, each of whom had filed patent-infringement cases against the other, have decided to enter into a cross-licensing agreement in exchange for dropping the lawsuits (thanks Jeff Magil). Here's an excerpt from the press release:

"Access to intellectual property is rapidly becoming the highest barrier to entry in today's PC graphics market," said Andrew Wolfe, Chief Technology Officer for S3 Incorporated. "Over the past ten years, S3 has built an incredibly strong IP portfolio through internal development, as well as through licensing agreements with Intel, Exponential, Cirrus and now NVIDIA. Based on our IP strengths, S3 and NVIDIA rank as possibly the only two companies positioned to win long-term in the PC graphics market."

"With this announcement we have reached an agreement that is mutually beneficial to both companies," said Jen-Hsun Huang, President and CEO at NVIDIA. "Over the years, S3 has developed and acquired a rich portfolio of technologies in graphics, multimedia, microprocessors and system logic. Our license agreements with SGI and S3, combined with NVIDIA's rich technology patent portfolio, gives us a strong technology base on which to build winning products."