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Nichia brought a patent trial against Seoul Semiconductor in GB (153)

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KH

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2008-10-02

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1. Nichia brought a patent trial against Seoul Semiconductor in GB

Nichia Chemical Industries (hereinafter, referred to as ¡°Nichia¡±), a Japanese LED special manufacturer, brought another patent trial against Seoul Semiconductor in GB. Following the patent trial brought before the California District Court in the USA in 2006, this case is the ninth patent trial brought by Nichia against Seoul Semiconductor and this case is the fifth patent trial filed this year. As a result of comprehending and reviewing the contents of the written trial received from Nichia, Seoul Semiconductor asserted that there are no matters infringing Nichia¡¯s patent.

On September 17, 2007, Nichia announced that they brought a trial prohibiting the sale and use of infringing items and a trial claiming damages caused by the patent infringement against Seoul Semiconductor and Avenet EMG, a distribution company, before the GB Court. Nichia argued that Seoul Semiconductor infringed the Nichia¡¯s patent, GB Patent No. EP (UK) 541,373 regarding an annealing method. Annealing is a technology to increase the flexibility of a product by heating a nitride gallium (GaN) based compound layer at a temperature of 400¡É or more, maintaining the layer for a predetermined time and then cooling the layer at room temperature. The annealing technology is essential for LED mass-production. ¡°We regard that it is important to protect an intellectual property right and we will continue using our right positively in the whole world,¡± a Nichia¡¯s spokesman said.

Nichia brought patent trials against Seoul Semiconductor in January 2006 and May 2007 in the USA and Japan and brought two patent infringement trials in the Republic of Korea in September and October 2007. Seoul Semiconductor also brought four counter-actions against Nichia in 2007 and 2008. Up to now, Nichia and Seoul Semiconductor have a total of 13 legal offensive and defensive cases.


2. The patent dispute on the ¡°GPS receiver chip¡± has come to the end of a chapter

After the US International Trade Commission (¡°ITC¡±) decided that the importation of a GPS receiver chip manufactured by SiRF Technology shall be prohibited, how the situation is going to develop being watched. If a final decision of import prohibition is made, the distribution of navigation systems and mobile phones using the SiRF¡¯s chip will be prohibited in the USA and therefore the related companies are expected to have concern.

According to a major foreign news source, as of August 31, 2007, Carl Charneski, an administration judge of ITC, indicated that SiRF Technology infringed 6 patents of the competitor company, Global Locate, and made the decision that ITC shall prohibit the importation of the concerned products. Furthermore, he recommended that ITC ban the importation of the devices using the products which infringe the patents. The products which are determined as infringing the patents are ¡°SiRF Star3¡± and ¡°SiRF Instant GSP Architecture.¡±

After reviewing the decision of the administration court, ITC will make a final decision on whether to prohibit the importation of the concerned products in December, 2008. When the decision on the import prohibition is finally made, the decision will be actually effective beginning February 2009 at the earliest. However, the related companies have been already put on special alert. Since the GPS chips of SiRF Technology are used for a great number of navigation terminals, the presentmarket of which has been explosively increasing, plus the GPS chips are going to be used for mobile phones, the aftermath is expected to be serious.

It is reported that Mitac, a Taiwanese company which is one of the world top 5 navigation manufactures, will not use the GPS chip of SiRF Technology any more, to minimize the damages caused by the patent dispute. Citing the well-informed sources, Digi Times of Taiwan reported that Mitac which had used the GPS chips of SiRF Technology for 80% of the total navigations have started to prepare for the change.

As the situation becomes serious by the clients finding other suppliers and the stock price downturn, SiRF Technology is trying to calm down the uneasiness of the market. ¡°The current decision of ITC is not the final decision. We will file an appeal against ITC,¡± the founder of SiRF Technology, Kanwar Chadha, said.

Global Locate which is a GPS chip and software special manufacture established in 1999 has 175 GPS patents in the world and was taken over by Broadcom for USD 146 million last year.


3. Korean patent technologies are promptly and strongly protected in the USA
- Comprehensive Patent Cooperation Memorandum of Understanding (MOU) is concluded between Korea and US

A procedure is expected to be open, through which Korean technologies can be protected as a ¡°strong patent¡± by a fast and high-quality patent examination in the USA.

The Korean Intellectual Property Office (KIPO) announced that, in the meeting of KIPO Commissioner and USPTO Commissioner held in Geneva, Switzerland on September 23, 2008, Jungsik KOH, the KIPO Commissioner, and Jon W. Dudas, the USPTO Commissioner, concluded the MOU for the comprehensive patent cooperation between the two countries.

The main point of this MOU is to promote the ¡°patent examination cooperation (worksharing)¡± to conduct one country examination by using the results of examination conducted in the other country, through the Korea-US patent examination environment harmony. For the patent examination environment harmony, the two countries plan to promote various and substantive cooperation projects, such as the construction of a common search database, the use of standardized patent classification systems, the education and training of examiners and the use of mutual examination results.

When the cooperation projects between the two countries are positively promoted according to the MOU, Korean technology examined in Korea is expected to be rapidly examined in US. Furthermore, as the examination quality is enhanced, it is expected to open a way for Korean people to obtain a more powerful patent right in US.

The MOU between these two countries is concluded as the US leading the international order of intellectual property rights hopes Korea to be a first country to build the strategic partnership relation in the patent field.

The selection by the US is regarded as totally considering that Korea is the top 4th country in the number of patent applications in the world, has excellent patent examination experts and has built a world class high-level patent information system.

KIPO and USPTO plan to have working-level talks within this year, to specify the cooperation projects included in the MOU.

¡°In order for Korean companies to easily and rapidly obtain patents in foreign countries, KIPO will continuously expand the patent work cooperation to the other advanced countries as well as US. For this purpose, since it is important to secure the examination quality to be mutually reliable, KIPO will strengthen the patent examination policy focused on the quality,¡± the KIPO Commissioner, Jungsik KOH, said.


4. Quality of a patent trial is improving
- The rate of canceling a trial decision regarding a patent/trademark is decreasing.

According to the Korean Intellectual Property Tribunal (KIPT; President: Youngtak PARK), the rate that the Korean Patent Court cancels a patent decision because it was misjudged is gradually decreasing.

According to KIPO, the rate of canceling a trial decision was about 28% in 2006 but decreased to 23% in 2007 and to 22% this year, showing a decrease every year.

This is considered as a result of efforts to improve the trial quality which has been promoted several years ago. In fact, KIPO has expanded the oral examination and the technology presentation for demandants from 2005. Further, KIPO has designated and operated the resp ¡¡

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