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Teco seeks damages from Sharp

"Teco has a high regard for patent holders and intellectual property rights. But, we don't want to fall victim to patent feuds among LCD panel makers."

George Lien, a Teco executive

Teco Electric & Machinery Co (東元電機), a leading Taiwanese television vendor, yesterday countersued in an ongoing dispute with Sharp Corp, filing for damages and alleging that the Japanese TV giant's tactics have hurt its brand image.

Teco's Japanese unit, Sankyo Co, yesterday filed a lawsuit against Sharp in Tokyo District Court, requesting ¥200 million (US$1.85 million) in damages and that a letter of apology be published in major newspapers to compensate for the Japanese company's "improper actions," Teco said.

Teco's latest move follows on charges filed by Sharp in mid-February that alleged the company had infringed on its liquid-crystal-display (LCD) patents.

The charges were seen by many as an attempt to fend off competition from Teco's lower-priced slim-screen TVs in the world's second-largest LCD TV market.

Similar charges filed previously by the Japanese company were thrown out.

"Teco has a high regard for patent holders and intellectual property rights. But we don't want to fall victim to patent feuds among LCD panel makers [amid heated competition]," said George Lien (連昭志), a Teco executive.

Sharp, the world's biggest LCD vendor, has misled Japanese electronics distributors and consumers, leading them to view Teco as a company that manufactures poor-quality products on infringed patents, Teco said in a statement released yesterday.

Sharp had maliciously concealed from the public a court ruling on lawsuits filed last June requesting a ban on imports of Teco's 20-inch TV sets that use flat panels made by AU Optronics Corp (友達光電), Taiwan's top LCD screen maker, according to the statement. The court denied Sharp's requests.

Additionally, Sharp asked for a ban on imports of Teco's LCD TVs into the Japanese market, but customs officials have not yet made a decision on the matter, according to Teco's statement.

Last year, Japan was the world's second-largest LCD market, after Europe, consuming one-third of the 8.8 million slim-screen TVs produced globally, according to a report by researcher DisplaySearch.

Teco shares have slid 12 percent since the beginning of the year, and closed at NT$9.28 yesterday on the Taiwan Stock Exchange.
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