The US Integrated Circuit Systems, Inc. allegedly published an advertisement in DigiTimes that damaged the business reputation of another in violation of the Fair Trade Law
Case:
The US Integrated Circuit Systems, Inc. allegedly published an advertisement in DigiTimes that damaged the business reputation of another in violation of the Fair Trade Law
Key Words:
warning letter from attorney, patent rights, adversely affect the trading order
Reference:
Fair Trade Commission Decision of November 8, 2001 (the 522nd Commissioners' Meeting); Disposition (90) Kung Ch'u Tzu No. 183
Industry:
Manufacturing of Photoelectric Materials and Devices (2792)
Relevant Law:
Article 24 of the Fair Trade Law
Summary:
1. This case originated with a complaint by Phaselink Co., Ltd. (Phaselink) that two attorneys, Lin Chih-gang and Chen Ho-kui of the Taiwan International Patent & Law Office (TIPLO), acting as attorneys for the US Integrated Circuit Systems, Inc., placed an advertisement on page 20 of the 10 November 2000 DigiTimes claiming that it owned patent of a "frequency generator for 'programmable system on a chip (PsoC)'in the U.S. " The advertisement further stated that "Many similar products from Chinese Taipei and other countries all have functions similar to the aforementioned patented product, leading to suspicion of infringement," and that if a company uses the referenced model number, it should first ascertain the legality of the PSoC frequency generator product it is using. The complainant stated that the model number listed, PLL202-01, was one of the its main products, and alleged possible violation of the Fair Trade Law due to the effect of the advertisement on its business reputation.2. The Fair Trade Commission's investigation showed that: Integrated Circuit Systems, Inc. claimed that it had been unable to ascertain the manufacturer of the product based on the technical manuals listing the model number in question, and so it had not consulted with Phaselink. The alleged purpose of the advertisement was to proclaim its lawful US patent rights and the scope of those rights, in order to protect its patents on related products, and it claimed that since the publication of the advertisement, no customer had inquired about the matter or switched its orders to Integrated Circuit Systems. However, Integrated Circuit Systems had not obtained an initial court ruling, nor had it attempted to preclude infringement through notification of Phaselink. Therefore its conduct did not constitute proper exercise of its rights in accordance with the Patent Law.3. In conclusion, the conduct of Integrated Circuit Systems in publishing a warning notice without having undertaken the required procedures mentioned above did in fact run counter to business ethics and adversely affected the trading order, in violation of Article 24 of the Fair Trade Law. Therefore, pursuant to Article 41 of the same law, Integrated Circuit Systems was ordered to immediately cease the aforementioned obviously unfair conduct sufficient to adversely affect the trading order.Summarized by Chou, Yu-Wei; Supervised by Shih, Chin-Tsun