Intel got a downgrade from US Bancorp Piper Jaffray Tuesday. Analyst Ashok Kumar dropped the stock to "buy" from "strong buy," citing weakening demand for the chipmaker’s products. The company also got slammed by Broadcom, which claimed its current patent suit is groundless. Shares were down 2.44 to 71.5 before the opening bell on the Island ECN. The company had recently received an upgrade from Lehman Brothers. But Kumar has been known to go against the grain. The stock has peaked, and can now be expected to "pull back into its base in the $60s," according to the report. The stock's recent advances are negligible compared to advances over the last two years -- a 4-fold increase, and Kumar sees weakening fundamentals as a sign the long run-up is over. "Continued demand weakness could result in unit growth which is well below consensus expectations," Kumar stated in the report. Sequential unit growth is now expected in the mid single digits. That revised expectation is still counting on a pickup in demand over the next three weeks. "If this business does not materialise, there could be further risk to our revenue estimate, which is at the low end of the street," Kumar added. The report also cautions that the pricing environment for Intel could turn malignant due to an inventory overhang going into the December quarter. Tactical issues which the company also faces include the recent recall of the 1.13 GHz PIII. Kumar stated that he doubts "the company can qualify the new process/equipment in the time frame of relevance" and sees gross margins under pressure as a result. Other negative news for Intel Tuesday came in a statement from Broadcom; the company’s CEO called Intel’s patent suit against it "baseless." Dr. Henry T. Nicholas III, Broadcom’s president and CEO said that though the company "prefer(s) not to issue statements on pending litigation," it has done so due to the "provocative nature of Intel's recent claims." Broadcom called Intel's allegations "a baseless and transparent attempt to create fear, uncertainty and doubt in (its) customers, strategic partners and the investment community," and a rehash of another lawsuit earlier this year, in which "Intel attempted to block Broadcom's employment" of three former Intel employees. After a nine day hearing, the court found that the employees had not disclosed any Intel trade secrets, and they remain in their jobs today. After hearing the evidence in that case, the court concluded that Intel itself had done the wrong-doing, by misappropriating Broadcom's Gigabit Ethernet Physical Layer (PHY) technology without authorisation. The issue is the subject of a cross-complaint that Broadcom filed against Intel on June 30, 2000. Of the five patents asserted by Intel, four are related to areas where Broadcom conforms to industry standards, the company said. The last patent asserted by Intel is a 12-year-old patent, and Broadcom has been unable to identify any of its products that relate to it. Broadcom said it holds 22 allowed United States patents and has about 350 additional US patent applications pending. What do you think? Tell the Mailroom. And read what others have said. See ZDII for US tech investor news. See techTrader for more technology investment news, plus quotes and research.