TEMPTOS

It was called the Mother of All Programs, or MOAP for short. That was the code name Intel (INTC) bestowed on a series of payments it made to Dell (DELL), one of its largest customers, over a five-year period through January 2007.

Now that $6 billion in payments has become the mother of all predicaments for Intel, the world’s largest computer-chip maker. New York Attorney General Andrew Cuomo, in a federal antitrust lawsuit, says Intel wielded those payments to coerce computer makers into using its chips instead of those made by Advanced Micro Devices (AMD).

Over several years, Intel used payments to a host of computer makers including Hewlett-Packard (HPQ) and IBM (IBM) as part of a “systematic campaign of illegal conduct” intended to harm AMD, according to the lawsuit. Cuomo’s suit follows legal action by antitrust regulators in Europe, Japan, and South Korea who also allege that Intel used the payments to gain an unfair advantage over AMD.

Newly filed court documents in the New York Attorney General’s case draw on extensive communication among senior executives at Dell and Intel and shed fresh light on Dell’s increasing reliance on Intel money to meet financial targets. Capping an investigation announced in January 2008, the lawsuit also provides added insight into the accounting methods used by Intel to justify payments that prosecutors say had no legitimate business purpose, and the swift retribution that followed Dell’s decision to begin using computer chips from AMD.