Nichia settles US patent litigation, loses case in Korea

Nichia has settled its LED patent litigation against Creative Technology, but has had design patents ruled invalid in Korea.

Dec 14th, 2006
Japan-based LED maker Nichia has reached a settlement in its pending design patent litigation in the US against Creative Technology and related companies.

In the complaint filed in the Federal Court for the Northern District of California in January 2006, Nichia alleged that its US design patents where being infringed by Korean LED maker Seoul Semiconductor Ltd. and its U.S. subsidiary Seoul Semiconductor Inc (see Nichia asserts design patents against Seoul Semiconductor).

The complaint also named Creative Technology, which used Seoul Semiconductor's LEDs to backlight the LCD screens in its MP3 players. Nichia says that it and Creative Technology have "arrived at a commercial settlement which will be mutually beneficial." One guess is that Creative has now agreed to use Nichia LEDs in its products.

The pending litigation in the US continues between Nichia and Seoul Semiconductor.

However, a press release from Seoul Semiconductor (SSC) suggests that the result of a patent litigation lawsuit in Korea could have an influence on the US case.

The Korean Intellectual Property Office (KIPO) has ruled that Baron Tech Co., Ltd, a Korean firm, has won its "Design Patent Invalidation" against Nichia. The decision has invalidated a Nichia design patent in Korea.

The now-invalidated Korea design patent relates to a side-view, white LED, which has been used in LCD backlighting for mobile phones, PDAs, digital cameras, and navigation devices. Seoul says that Nichia has been supplying approximately $0.2 billion of these side-view LEDs annually to major Korean customers.

The invalidated Korea patent has the same design as the claim patent for which Nichia had filed a US lawsuit against SSC in January 2006 (see above).

SSC says that "the Nichia patent invalidation is expected to have a very positive effect for SSC on the result of the US lawsuit. It is also anticipated that US court will bring up the question of whether Nichia’s [US] design patent is valid."

Commenting on the case, Baron Tech CEO Myung Hwan Lee said: "Nichia has been threatening other LED companies around the world and filing lawsuits about patent infringement to interrupt companies from entering into the market and to retain its monopoly position. However, KIPO’s patent invalidation judgment will put a stop to Nichia’s inappropriate actions."

Soo Wan Lee, AIP Patent & Law Offices Senior Attorney, who has been in charge of the Baron Tech trial, said: “The basic requirement for design patent is ornamentality or functional elegance. Nichia’s design patents do not meet the ornamentality requirement. Yet, Nichia has been sending letters of warning to many of the world’s LED firms, alleging that they have infringed upon Nichia’s design patents.”

Dae Hyun Jang, legal team leader of SSC, said: “Most importantly, this trial will help put a halt to Nichia’s aggressive omni-directional attacks on other LED companies, which quells unrest of both domestic and overseas customers and leads to the sound market competition.”

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