8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 7, 2006

ALLIANCE SEMICONDUCTOR CORPORATION

(Exact name of registrant as specified in its charter)

000-22594
(Commission File Number)

Delaware
(State or other jurisdiction of
incorporation) 77-0057842
(I.R.S. Employer Identification No.)

2575 Augustine Drive
Santa Clara, California 95054-2914
(Address of principal executive offices, with zip code)

(408) 855-4900
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

	Item 1.01 Entry Into a Material Definitive Agreement.
	Item 9.01 Financial Statements and Exhibits.
SIGNATURE
EXHIBIT INDEX
EXHIBIT 99.1

Item 1.01 Entry Into a Material Definitive Agreement.

     On July 7, 2006, Alliance Semiconductor Corporation (Alliance) entered into a settlement agreement with Prabhakara Balla and Trit Tek Research Ltd. (collectively, the Plaintiffs) that resolved the Plaintiffs’ lawsuit against Alliance. In 1985, the Plaintiffs filed a lawsuit against a number of defendants, including Alliance, alleging without specificity intellectual property infringement. Alliance agreed to pay the Plaintiffs $3.5 million in exchange for full settlement of all proceedings and a mutual general release of all related claims. The parties agreed to deliver such further documents as may be needed to effectuate the settlement, including a dismissal of the suit with prejudice (or the Canadian equivalent of a consent dismissal).

     A copy of a press release dated July 13, 2006, describing the settlement, is attached hereto as Exhibit 99.1 and incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits.

Exhibit No.	Description
99.1	Press Release dated July 13, 2006.

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SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ALLIANCE SEMICONDUCTOR CORPORATION
Date: July 13, 2006	By:	/s/ Melvin L. Keating
		Melvin L. Keating
		President and Chief Executive Officer

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated July 13, 2006.

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EX-99.1

Exhibit 99.1

Alliance Semiconductor Announces Settlement of Lawsuit

SANTA CLARA, Calif.—(BUSINESS WIRE)—July 13, 2006—Alliance Semiconductor Corporation (Nasdaq:ALSC, “Alliance”) today announced that on July 7, 2006, it entered into a settlement agreement with Prabhakara Balla and Trit Tek Research Ltd. (collectively, “Plaintiffs”) that resolved Plaintiffs’ twenty-one year-old lawsuit against Alliance. Trit Tek had a contractual relationship with Alliance in the company’s first year in existence, and Prabhakara Balla claimed to be a principal in that company. In 1985, Plaintiffs filed a lawsuit in Canada against a number of defendants, including Alliance. Asserting a misappropriation by Alliance of certain technology, Plaintiffs obtained a default judgment for approximately $172 million against Alliance in Canada in 1998, which was set aside both as to the default and damages in 1999. The default, but not the damages assessment, was later reinstated after further proceedings in the trial court. Alliance, after learning of the purported judgment, initially contested the lawsuit on the basis that it was not served properly and that the Canadian courts lacked jurisdiction over Alliance. Alliance also recently filed related litigation in California to establish that any judgment in Canada could not be enforced against Alliance, and also that Alliance’s 1991 bankruptcy discharged Plaintiffs’ claims. This settlement ends for all parties the continued expense of these protracted proceedings. Pursuant to the settlement agreement, although continuing to deny liability, Alliance agreed to a cash payment to Plaintiffs in exchange for full settlement of all proceedings and a mutual general release of all claims. In reaching the settlement, Alliance recognizes the contributions of Prabhakara Balla to the origins of certain of Alliance’s semiconductor products.

Forward-Looking Statements
Except for historical information contained in this release, statements in this release may constitute forward-looking statements regarding our assumptions, projections, expectations, targets, intentions or beliefs about future events. Words or phrases such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “targets,” “will likely result,” “will continue,” “may,” “becoming,” “receiving” or similar expressions identify forward-looking statements. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed. We caution that while we make such statements in good faith and we believe such statements are based on reasonable assumptions, including without limitation, management’s examination of historical operating trends, data contained in records, and other data available from third parties, we cannot assure you that our projections will be achieved. In addition to other factors and matters discussed from time to time in our filings with the U.S. Securities and Exchange Commission, or the SEC, some important factors that could cause actual results or outcomes for the Company or our subsidiaries to differ materially from those discussed in forward-looking statements include: changes in general economic conditions in the markets in which we may compete and fluctuations in demand in the semiconductor and communications industries; our ability to sustain historical margins; increased competition; increased costs; increases in our cost of borrowings or unavailability of debt or equity capital on terms considered reasonable by management if the need for financing arises; litigation; and adverse state, federal or foreign legislation or regulation or adverse determinations by regulators. Any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all such factors.

Contacts:

Alliance Semiconductor Corporation, Santa Clara, CA
Melvin L. Keating, President and Chief Executive Officer

408-855-4900

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