Nichia and Seoul offer different views of jury ruling

A jury in the United States says that Seoul Semiconductor LEDs infringe on several US design patents owned by Nichia. However, Nichia was only awarded $62 (or $250, depending who you ask).

Press releases from Nichia and Seoul Semiconductor presented significantly different views of the outcome of an LED patent dispute between the two companies. The jury verdict was delivered in the US District Court for the Northern District of California.

Nichia filed the infringement action in January 2006. It claimed that Seoul Semiconductor’s 902 series side-view LEDs, used for mobile phone BLUs, were infringing on Nichia’s US design patents (numbers D491,538; D490,784; D499,385 and D503,388). Nichia sought an injunction and demanded compensation for damages.

Creative Technology, which uses Seoul Semiconductor's LEDs to backlight the LCD screens in its MP3 player, was included in the original complaint, and settled its dispute with Nichia in November 2006.

According to Nichia, the jury unanimously found that Nichia’s design patents had been infringed. The jury also found that Seoul’s infringement was willful. Nichia has posted the verdict form on its website – see http://www.nichia.co.jp/specification/ip/verdict_form.pdf.

However, Seoul Semiconductor claimed that it had "substantially prevailed" in the lawsuit. Seoul said that it was found to be not liable for damages on 3 out of 4 of Nichia's US design patents. It also said that the jury award was limited to $62 recovery on the 4th patent.

According to Nichia, the amount was $250. Either way, the amount falls far short of the several million dollars in damages originally requested by the Japanese company. Both Seoul and Nichia are thought to have spent many millions of dollars fighting the case.

A Nichia spokesperson told LEDs Magazine "The amount is limited because the most of the accused products were not directly distributed in the US by Seoul but indirectly distributed in the US in consumer products, such as cellular phones. The damage only covers the direct sales in the US because Seoul argued that it is not aware whether their accused LEDs go to the US and, thus, is not responsible for such indirect sales in the US."

Seoul Semiconductor’s 902 series LEDs are mostly used for LCD (liquid-crystal display) backlight units in consumer products such as cellular phones. According to Nichia, the verdict means that any consumer product distributed in the US, that incorporates Seoul's 902 LED, will be containing a patent-infringing product.

According to Nichia's spokesperson, the Japanese company is now asking the court to grant an injunction based on the verdict. "The judge, as opposed to the jury, will decide on the injunction. If granted, the injunction will ban the sale of 902 LEDs and any other Seoul products that infringe Nichia's patents."

Nichia said that it welcomes the verdict and is confident that other courts in Korea, the US and Japan that are currently dealing with the disputes between Nichia and Seoul Semiconductor will also uphold Nichia’s IP rights.

Conversely, Seoul Semiconductor says that it is "vindicated that, after almost two years of litigation, the sales of its side-view LED 902 are actually non-infringing and that it has substantially prevailed in this litigation."

Seoul Semiconductor also says that it continues to believe that Nichia's US design patents are invalid, and has asked the US Patent and Trademark Office to re-examine all four patents asserted against it. Nichia’s same design patents were previously invalidated by the Korean Intellectual Property Office in December 2006.

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