Genesis Microchip and MStar Reach Settlement of Patent Infringement Lawsuit

SAN JOSE, Calif.-- Oct. 18, 2006 --Genesis(R) Microchip Inc. (Nasdaq:GNSS), a world leader in the development of image processing technologies for flat-panel TVs, monitors, and other consumer display products, and MStar Semiconductor, a market leader in IC design and image processing technologies for LCD flat panel television and computer monitors, today announced they have settled the patent infringement complaints filed by Genesis Microchip against MStar in the U.S. International Trade Commission (ITC) and entered into a license agreement.

The ITC had previously ruled that certain controllers and products containing those controllers infringed Genesis Microchip's U.S. Patent No. 5,739,867 and issued an Exclusion Order preventing the infringing products from entry into the United States. While the terms of the license agreement are confidential, they include a license of certain Genesis Microchip patents to MStar in exchange for undisclosed running royalties. This license allows MStar to ship the infringing products into the United States.

"We have entered into this license agreement with MStar to foster an environment of fair competition and to support our continual goal of protecting Genesis Microchip's significant investment in its intellectual property," said Elie Antoun, president and CEO of Genesis Microchip.

"We appreciate Genesis Microchip's cooperation in settling this matter which provides a stable market environment for our customers," said Wayne Liang, chairman of MStar.

About MStar Semiconductor

MStar Semiconductor, Inc. is a professional IC design house, and is dedicated in providing mixed-mode integrated circuit technologies. By combining semiconductor design expertise and advanced proprietary technologies, MStar delivers a broad line of products: multimedia, wireless communication ICs, and general-purpose mixed-mode ICs. For more information please visit http://www.mstarsemi.com.tw

About Genesis Microchip

Genesis Microchip Inc. (Nasdaq:GNSS) is a leading provider of image processing systems enabling superior picture quality in flat-panel TVs and a variety of consumer and PC-display products. Featuring Genesis Display Perfection(R) technologies and Emmy award-winning Faroudja(R) video technologies, Genesis system-on-a-chip solutions are used worldwide by display manufacturers to produce visibly better images across a broad array of devices including flat-panel displays, digital TVs, projectors, A/V receivers and DVD players/recorders. The Genesis technology portfolio features analog and mixed signal system-on-a-chip design, DCDi(R) by Faroudja deinterlacing, TrueLife(TM) video enhancement, IntelliComb(TM) video decoding and includes over 185 patents. Founded in 1987, Genesis supports its leading brand-name customers with offices in the U.S., Canada, India, Europe, Taiwan, South Korea, China, Japan and Singapore. For more information about Genesis Microchip Inc. or Genesis Display Perfection technologies, please visit www.gnss.com.