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Chipmaker's complaint not good for tech industry

By Zhong Nan | China Daily | Updated: 2018-01-04 07:46
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A Lenovo employee fixes internal cables onto a laptop in Whitsett, the US. PROVIDED TO CHINA DAILY

Experts warned on Wednesday that US chip manufacturer BiTMICRO's filing of a complaint against other global tech companies for infringing intellectual property rights would be counterproductive and goes against the trend of globalization.

The Virginia-based semiconductor producer, which makes solid-state drives (SSD), stacked electronics components and other products, filed the complaint late last month against more than a dozen global tech companies including Dell, Samsung Electronics, Lenovo, SK Hynix Inc and VAIO Corp.

It claimed that the 17 proposed respondents violated Section 337 of the US Tariff Act of 1930 by importing and selling products that infringe the asserted patents. The complaint specifically refers to various computers, mobile phones, tablets, watches, and components thereof, as infringing products.

The press office of Lenovo Group Ltd did not respond to China Daily on Tuesday. Lenovo and its North Carolina-based subsidiary Lenovo (United States) Inc is the only company in the Chinese mainland that has been targeted by this move.

Cheng Zhiwei, a business professor at Nankai University in Tianjin, said as BiTMICRO's complaint involved many major companies in the world including those US manufacturers, the US government will handle it carefully and it will put pressure on US policymakers to respond to the complaint.

"For BiTMICRO, targeting its competitors will not resolve its difficulties on sales and the company should be aware that the rapid growth of the flows of technology, information, data, know-how and knowledge has existed for long time within and across borders, thanks to the power of globalization," said Cheng.

Li Guanghui, vice-president of the Chinese Academy of International Trade and Economic Cooperation in Beijing, said this move is intended to subvert both BiTMICRO's domestic and foreign rivals, as the US firm, once a leader in the SSD market between 2000 and 2008, has been losing ground to other companies.

"Giant companies such as Intel Corp, Samsung Electronics Co and SanDisk Corp currently have the majority of the SSD market. As China's largest personal computer manufacturer, Lenovo's core business is not SSD. It will not have a big impact on the company's commercial operations," said Li.

Launched by the United States International Trade Commission, Section 337 investigations are related to claims involving intellectual property rights. It declares the infringement of a US patent, copyright, registered trademark, or mask work to be an unlawful practice in import trade.

The US International Trade Commission normally decides on whether to launch an investigation within 30 days of receiving a complaint.

Samsung Electronics said on Tuesday that the company would "respond after thoroughly reviewing the case".

South Korea's Trade-Investment Promotion Agency has also warned of the growing number of complaints related to US trade laws.

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