U.S. to probe Taiwan IC designer for patent infringement

06/03/2022 04:43 PM
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CNA file photo
CNA file photo

Taipei, June 3 (CNA) The U.S. International Trade Commission (USITC) has voted to launch an investigation into a patent infringement allegation against Taiwanese communication network IC designer Realtek Semiconductor Corp. and other companies.

According to a statement released by the USITC on Wednesday, the investigation will look into certain graphics systems, components, and digital televisions containing the same parts which contain the alleged stolen patents in question.

In addition to Realtek, the USITC also voted to start investigations into a patent infringement case against China-based TCL Industries Holdings Co. and its subsidiaries in Hong Kong and other overseas markets, the commission said.

The USITC said the decision to launch the probe into the allegations against Realtek and TCL came after Advanced Micro Devices, Inc. (AMD) of the U.S. and ATI Technologies ULC of Canada filed a complaint on May 5, saying that these companies had infringed on their patents.

The complaints alleged that Realtek and TCL violated section 337 of the Tariff Act of 1930 for the sale of certain graphics systems, components, and digital televisions containing the same parts that infringe patents asserted by the complainants, the USITC said.

The complainants have requested the USITC to issue a limited exclusion order and cease and desist orders, according to the commission.

In response, Realtek only said the case is still under investigation and the company is not able to make any prediction about the results for now.

Despite the vote to launch the investigation, the USITC said the commission had not made any decision on the merits of the case.

In the statement, the USITC said its chief administrative law judge would assign the case to one of the commission's six administrative law judges, who will hold an evidentiary hearing and issue a preliminary ruling. The initial ruling is subject to review by the commission, which will lay down a final decision.

Within 45 days after the institution of the probe, the USITC will set a target date for completing the investigation, the commission said.

Analysts in Taiwan said chips used in TV production account for about 10 percent of Realtek's total sales, adding that since global demand for consumer electronics gadgets has been weakening, the Taiwanese IC designer is expected to see little change to its revenue in that sector this year.

Realtek has intensified its efforts to upgrade its network communication IC development and enter the advanced WiFi 6/6E business to offset the impact from the weakening demand for consumer electronics products.

In the first quarter of this year, Realtek posted a quarterly high net income of NT$5.19 billion (US$177 million), up 12.6 percent from a quarter earlier and also up 69.8 percent from a year earlier. The first quarter earnings per share stood at NT$10.15, compared with NT$9.02 a quarter earlier and NT$5.98 a year earlier.

(By Chang Chien-chung and Frances Huang)

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