FA complaint is filed against Nichia Corporation for improperly disseminating false statement that the other enterprise has infringed its patent

Chinese Taipei

Case:

A complaint is filed against Nichia Corporation for improperly disseminating false statement that the other enterprise has infringed its patent

Key Words:

Warning L etter, Website

Reference:

Fair Trade Commission Decision of August 4, 2005 (the 717th Commissioners' Meeting), Letter Kung Erh Tzu No. 0940006508

Industry:

Computer Manufacturing (2611)

Relevant Laws:

Subparagraph 1,Article 19、Article 22 and Article 24 of the Fair Trade Law

Summary:

1. A complaint was filed by the complainant Epistar Corporation (hereinafter referred to as Epistar) against Nichia Corporation (hereinafter referred to as Nichia) that for the purpose of market competition, Nichia with a bad intention has repeatedly posted messages on its own company website indicating that the blue LED (Light Emitting Diode) product of Epistar has infringed its patent since the last four months of 2003. In addition, Nichia also made a publication on media stating that the white LED product of Epistar may also have infringed its patent . The act of Nichia has injured the goodwill of the complainant and thus violated Subparagraph 1, Article 19, Article 22 and Article 24 of the Fair Trade Law.
2. The investigation found that the two news posted by Nichia on its own company website on September 24, 2003 and October 1, 2003 were announcements to the public that the Court of Chinese Taipei has rendered a ruling of provisional seizure and provisional disposition on Epistar for the infringement of Nichia’s Chinese Taipei patent no. 160722 by “one” of the Epistar’s blue LED products. The product mentioned in the aforementioned announcements indeed is one of the blue LED products manufactured by Epistar. Epistar complained that although the Court’s ruling is only directed against the product model number “ES-CEBH712:A3”, one of the many blue LED products manufactured by Epistar and furthermore the volume of production for this model is very small; but Nichia has exaggerated and said that all “Blue LED” products of Epistar have patent infringements. With regard to this complaint, it is found that Nichia has clearly indicated in the aforementioned website’s news that the Company only takes legal action against one of the products manufactured by Epistar. In addition, it is also found that Nichia actually has entrusted the Executive Yuan and the Judicial Yuan to conduct the coordination and appoint a professional institution (in this case, Yen Tjing Ling Industrial Research Institute, National Taiwan University) to perform the expert verification work on the Epistar’s product model number ES-CEBH712:A3 prior making the aforementioned announcements. An expertise report that confirms the patent rights infringement was given to Nichia. Moreover, Nichia has notified Epistar beforehand that it has already sought relief with the procedure for interim remedies and requested a provisional seizure of the property of Epistar. Epistar was aware of the legal actions taken by Nichia beforehand and have opportunity to make refutation. In addition, Nichia announced on its own company website on June 11, 2004 that Nichia has filed two lawsuits at South Korea, one lawsuit against a Taiwanese company in South Korea and another lawsuit against a Korean company, that the LED products of these two companies have infringed its patent rights. The investigation found although it is true that Nichia has filed litigations of patent infringements in South Korea nevertheless the company names of the accused were not mentioned in the website’s announcement. Moreover, Nichia has enclosed technical reports when filing litigations in South Korea.
3. To conclude from the above, an examination of the aforementioned announcements reveals that the conduct of Nichia to make the website announcement at issue is mainly for the purpose of protecting its intellectual property rights, it is still difficult to conclude that such act is for the purpose of damaging specific enterprise. Furthermore, the relevant announcements also neither show any intention of urging other enterprises to stop trading with Epistar nor have any false statements. Therefore, it is difficult to conclude that Nichia has violated Subparagraph 1, Article 19, Article 22 and Article 24 of the Fair Trade Law. As regard to the news coverage of “Nichia Corporation alleged that Epistar has infringed Nichia’s two Taiwanese patents again” published on the website of Nikkei News on December 19, 2003, the Nikkei News wrote down “Reported by Nikkei BP” in the beginning of the news and “Reporter: Satoru Okubo” at the end of the news. It is clear that the news at issued was covered and reported by the said Nikkei reporter and there was no concrete evidence to conclude that Nichia has intentionally published the news and caused misleading. It is still difficult to conclude that Nichia has violated the Fair Trade Law. In the case that if the relevant reports are exaggerated and misleading and thus have caused damages to the rights and interests of the complainant, the complainant should in stead resolve the dispute through judiciary process.

Summarized by Chen, Shu-Hua;
Supervised by Liou, Chi-Jung

Appendix:

EPISTAR Corporation’s Uniform Invoice Number: 84149786
NICHIA Corporation