Touchpanel controller supplier FocalTech Systems Co (敦泰電子) yesterday said it is seeking NT$794.36 million (US$25.79 million) in damages in a patent infringement lawsuit against local rival Novatek Microelectronics Corp (聯詠科技) in an effort to fend off growing competition.
The latest legal action came after FocalTech last month said Novatek had allegedly infringed on its patents linked to the manufacturing of a new type of chip that integrated a driver and a controller, known in the industry as a touch controller with display driver integration (TDDI).
The TDDI is used mostly in smartphones.
FocalTech on Aug. 29 said in an e-mail that the patents are owned by its subsidiary, FocalTech Electronics Ltd.
In the latest development, FocalTech Systems pushed the litigation further by requesting the Intellectual Property Court in Taipei look into the damages and require Novatek to compensate its revenue losses during the first three quarters of this year, according to a statement issued to the Taiwan Stock Exchange yesterday.
FocalTech Systems said it might seek a higher amount of damages if Novatek continues to illegally use the patents and cause greater revenue loss, the statement said.
FocalTech Systems also requested the court to ban Novatek from using the patents to make chips and to restrict Novatek’s customers from selling products containing the problematic chips, the statement said.
All the chips should be recalled and destroyed, the statement added.
FocalTech reported 158 percent growth in net profit of NT$79.93 million for the first half of this year, compared with NT$31 million in the same period last year.
Earnings per share jumped to NT$0.31 from NT$0.12 over the period, company data showed.
The company attributed the strong growth to price increases and robust demand from Chinese smartphone makers during the peak season.
FocalTech expects its revenue to fall this quarter from last quarter’s NT$2.73 billion due to supply constraints on chips.
Novatek’s net profit rose about 16 percent year-on-year to NT$2.5 billion in the first half of this year from NT$2.15 billion the previous year.
That translated into earnings per share of NT$4.11.
Novatek last month said its revenue is forecast to grow by between 13.04 and 16.05 percent to between NT$15 billion and NT$15.4 billion this quarter, from NT$13.27 billion last quarter.
Gross margin is to stay at between 29 and 30.5 percent this quarter, compared with 30.21 percent last quarter, it said.
FocalTech shares fell 0.99 percent to close at NT$25 in Taipei trading yesterday, while Novatek shares fell 1.67 percent to close at NT$147.5.
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