Gemplus announces successful litigation result

Luxembourg – May 27, 2005 – Gemplus International S.A. (Euronext: LU0121706294 – GEM and NASDAQ: GEMP), the world's leading provider of smart card enabled solutions, today reports on a successful result on appeal in a lawsuit concerning an alleged breach of contract by Gemplus S.A., a subsidiary of Gemplus International S.A. in France, regarding the promotion of smart card solutions for casino slot machines.

On May 26, 2005, the Aix-en-Provence Court of Appeal rendered a decision in favor of Gemplus S.A., reversing the judgement of the Marseille Commercial Court of March 18, 2004 which had found that Gemplus S.A. had breached the contract and had ordered Gemplus S.A. to pay the plaintiffs € 22 million in damages. The Court of Appeals dismissed all the plaintiffs’ claims for damages and ordered the plaintiffs to pay court costs and expert’s fees. On April 2, 2004, the Court of Appeal had previously decided at Gemplus S.A.’s request to suspend the enforcement of the decision of the Marseilles Commercial Court and had ordered Gemplus S.A. to make a cash deposit of € 22 million into an escrow account as security pending the decision on Gemplus S.A.’s appeal on the merits. Now as a result of the May 26, 2005 appeal decision, this escrow deposit will be released and restituted in full to Gemplus S.A.

The group recorded a provision of € 5.2 million in respect of this matter, as reported in the Company’s consolidated accounts at December 31, 2003.

The case is subject to a possible request for appeal to the French Supreme Court, which would require that Court’s approval and be strictly limited to questions of law.

About Gemplus

Gemplus International S.A. (Euronext: LU0121706294 - GEM and NASDAQ: GEMP) is the world's leading player in the smart card industry in both revenue and total shipments (source: Gartner-Dataquest (2005), Frost & Sullivan, Datamonitor.). It has sold over 5 billion smart cards.

With security at its core, and 2400 patents and patent applications produced by its innovative R&D team, Gemplus delivers a wide range of portable, personalized solutions in areas including Identity, Mobile Telecommunications, Public Telephony, Banking, Retail, Transport, Healthcare, WLAN, Pay-TV, e-government, and access control.

Gemplus' revenue in 2004 was 865 million Euros.

www.gemplus.com

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