Amtran Technology Co Ltd (瑞軒) said yesterday that Vizio Inc’s latest patent disputes with LG Electronics Inc would not significantly harm Amtran’s finances as the royalties sought by LG were affordable.
On Thursday last week, South Korean TV maker LG Electronics filed a lawsuit with a US District Court in Texas, alleging that a handful of TV vendors, including Vizio — the US’ third-largest flat-panel TV vendor — had infringed on its patent in their high-definition digital TVs, Vizio said in statement on its Web site.
The intellectual property row dealt a blow to Amtran’s share prices yesterday on the other side of the Pacific. The shares plunged 6.71 percent to NT$13.9, underperforming the benchmark TAIEX, which fell 1.17 percent.
“We do not think the impact will be big in terms of shipments and finance,” Amtran spokesman Scottie Chiu (邱裕平) said by telephone.
Amtran holds a 23 percent stake in Vizio and supplies it with liquid-crystal-display (LCD) TV sets.
The royalties sought by LG Electronics were limited and the court would not ban Amtran from selling Vizio-brand TVs in the US before any ruling was made, Chiu said.
“It is commonly seen that big companies take legal action to prevent smaller rivals from catching up quickly, rather than intending any real harm,” Chiu said.
Chiu stressed that the company’s newly formed TV assembling and flat panel module manufacturing venture with LG Electronics’ panel affiliate, LG Display Co Ltd, would not be affected by the legal dispute either.
“We do not think this incident will lead to any changes to the venture. They are two separate issues,” Chiu said.
“Besides, it is a growing trend for TV makers to form partnerships with panel suppliers” to improve competitiveness, he said.
On Sept. 1, Amtran said it planned to establish Suzhou Raken Technology Ltd (蘇州樂軒) in Suzhou, China, with LG Display to assemble 3 million LCD panel modules and make 5 million flat-panel TVs a year. The venture will start operation early next year.
Amtran’s long-term partnership with LG Display would remain unchanged, Chiu said. Amtran is one of LG Display’s biggest LCD TV panel customers.
John Morris, Vizio vice president of core products, said “we fully expect [the lawsuit] will influence future material sourcing decisions.”
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