AMD has filed a complaint accusing four former employees of stealing and leaking sensitive corporate data to Nvidia before jumping ship to join its rival.
The employees accused in the court filing include one former vice-president and three former managers.
It alleges that the three collectively downloaded over 100,000 files six months before leaving AMD to join Nvidia.
AMD confirmed it had mounted the suit to V3 on Thursday, claiming that it had forensic evidence to prove its claim.
"AMD will always take action to aggressively protect its confidential, proprietary and trade secret information. We believe the facts are clearly outlined in our pleadings and are supported by forensic evidence. The pleadings are publicly available," AMD said in a statement.
"Current and former AMD employees are contractually required to honour the ongoing confidentiality and non-solicitation obligations each agreed to while employed with us."
At the time of publication Nvidia had not responded to V3's request for comment on the allegation.
The suit comes at a critical time for both companies, with both having unveiled their next range of products at the 2013 Consumer Electronic Show in Las Vegas earlier this month.
At the show AMD unveiled a suite of graphics and CPU hardware due for release in 2013, including its first quad-core system-on-a-chip (SoC) unit.
Simultaneously, Nvidia unveiled its next-generation Tegra 4 processor. The company claims the Tegra 4 is nearly twice as fast as the current competition.