Tuesday, February 14, 2006

JAPANESE CHIPMAKERS TURN TO . . . . TROLLING? For years, larger Japanese companies have been some of the most prolific filers of patents throughout the world, particularly in the U.S. While they continue to amass patents on key technologies, Japanese companies have traditionally eschewed "U.S.-style" litigation, in favor of traditional negotiation an licensing.

It appears that is starting to change, at least in the short-term.

As competition in the memory-chip sector heats up, Japanese companies are increasingly turning to litigation to protect their hard-won patents. In light of Korea's speedy ascent in the technology and IP sectors, Japanese chipmakers have ramped-up the number of patent infringement cases in an attempt to beat back the competition and to squeeze more value from technologies that took years and billions of yen to develop.

In the world of DRAM chips, Japanese chip manufacturers dominated this industry in the 1990s, but nearly all of them - with the exception of Elpida Memory Inc. - have since exited the business (Elpida being a joint venture between NEC and Hitachi). Today, South Korea's Samsung Electronics and Hynix are now the world's two largest makers of DRAM chips, while Elpida ranks fifth behind U.S.-based Micron Technology Inc. and Germany's Infineon Technologies AG. In the hot-selling NAND flash memory business, Samsung ranks No. 1 and Toshiba No. 2, but the Japanese company's lead over third-ranked Hynix is narrowing.

Recently, Japan's Toshiba Corp. filed a lawsuit in October with the U.S. International Trade Commission against South Korea's Hynix Semiconductor Inc. alleging that the South Korean chip maker infringed on its flash memory patents.

Also, Matsushita Electric Co. filed suit against South Korea's Samsung Electronics Co., alleging patent infringement related to DRAM, chip technology. The lawsuit was filed - where else - in the Eastern District of Texas, Marshall Division.

The interesting rub is that Matsushita stopped making DRAM chips in 1998. Matsushita has not provided further comment since filing the lawsuit in late January.

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