Mon, Sep 03, 2018 - Page 16 News List

Everlight downplays legal setback in Nichia battle

By Ted Chen  /  Staff reporter

LED chip packager and tester Everlight Electronics Co (億光) on Thursday last week downplayed its latest setback in a series of long-running patent battles with Japan’s Nichia Corp.

The German Federal Patent court ruled in Nichia’s favor and confirmed the validity of the Japanese company’s YAG phosphor patent in the country.

Nichia is seeking an injunction and damages as it claims that Everlight’s white LED products infringed its patent.

The court has set the value in dispute at 7.3 million euros (US$8.5 million), market research Web site LEDinside reported last week.

Everlight said that the patent expired on July 29 last year, and the case, which is not final and can be appealed, would have no effect on its current product mix, the company said in a statement on Thursday last week.

The company expects the court to rule in its favor eventually, the statement said.

Everlight said that it has repeatedly come out victorious in court battles across the globe regarding the same family of patents.

Nichia’s case, launched in 2011 to invalidate Everlight’s YAG phosphor patent in Taiwan, was overruled by local authorities in 2016 and an appeal was overruled in April.

Everlight said that its 2012 non-infringement case against Nichia was upheld by a US patent court in 2015 and again in March last year following an appeal.

On Friday last week, the company’s shares closed flat at NT$31.8 in Taipei and have dropped 29.25 percent so far this year as the company struggles to boost revenue and earnings growth.

Earnings per share of NT$0.79 for the first half of this year were the lowest in the company’s history for the same period since 2012, while its first-half revenue fell 10.2 percent from the same period a year earlier, company data showed.

The company said that improving mini-LED business and a better mix of product lineups would boost revenue to show positive annual growth next year and profitability should rebound in the medium term.

“Everlight’s core profitability would bottom out in the first half, with automotive lighting, infrared applications and mini-LED the major growth drivers in the years ahead,” KGI Securities Investment Advisory Co (凱基投顧) analyst Jennifer Liang (梁姿嫺) said in a note on Friday last week.

“The company’s share price has corrected by 21.3 percent in the past three months,” she said.

“In the near term, we expect the stock to stabilize by receiving support from investors’ expectation of profitability recovery and the company’s high cash dividend payout ratio of up to 70 percent,” Liang said.

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