TSMC Sues SMIC for Breaking 2005 Settlement
September 01, 2006
Following the lawsuit against China's SMIC (Semiconductor Manufacturing International) over its IP infringement in 2003, Taiwanese TSMC (Taiwan Semiconductor Manufacturing Company) accused SMIC of illegally using its process technologies in a California court on August 25, 2006. After the indictment in 2003, both companies had reached a settlement in 2005, under which SMIC agreed to pay TSMC a US$175 million compensation over the next six years; both companies also agreed to cross-license patented technologies through December 2010. However, TSMC claims that SMIC has breached the settlement and that it has continued to use TSMC's technologies without permission. As part of the latest court filing, TSMC requires SMIC to pay off the remaining US$130 million owed to it at once and seeks an injunction to inhibit SMIC from using certain TSMC patents and trade secrets.