U.S. firms take aim at local chipmakersThe local computer chip industry is on alert as the Trump government has shifted its targets towards Korea’s No. 1 export, semiconductors.
The pressure from the Trump administration against Korea’s semiconductors came a week after the U.S. International Trade Commission (ITC) proposed imposing a tougher trade barrier against imported Korean washing machines.
The U.S. federal trade agency on Nov. 28 decided to investigate potential patent infringement on memory module components developed by Korea’s SK Hynix subsidiaries including SK Hynix America as well as SK Hynix Memory Solutions in San Jose.
The complaint was made by the U.S. computer chip developer Netlist at the end of October.
“The action we took today brings to the ITC the latest, and some of the strongest patents in our portfolio covering SK Hynix server memory products,” said Chuck Hong, chairman and CEO of Netlist, in a statement released Oct. 31. “We remain committed to defending our intellectual property, and will take all measures necessary to stop SK Hynix’s prolonged and continuing infringement of our patents.”
If the ITC comes to the conclusion that SK Hynix has violated the section 337 of the Tariff Act of 1930, the two memory modules that Netlist has identified — SK Hynix’s RDIMM and LRDIMM — could be banned from being exported to the United States.
After the ITC decision was announced, Netlist’s stock price rose 3 percent.
The Korean industry saw the move as one made by a U.S. company that has been falling behind in competition against Korean goods actively using the Trump administration’s trade protectionism to their advantage.
This was not the first time Netlist has filed a complaint against the Korean chipmaker. In September 2016, Netlist accused SK Hynix of infringing on server memory patents, but the ITC came to the conclusion last month that it did not.
In September U.S. semiconductor packaging firm Tessera Technologies, a subsidiary of Xperi Corp., filed a lawsuit against Samsung Electronics, claiming it violated 24 patented items including the semiconductor process and bonding not only at the U.S. trade commission but also in three U.S. federal district courts.
“Samsung has benefitted from its use of our semiconductor technologies for 20 years, having entered into its first license with Tessera, Inc. in 1997. Samsung has also been a customer of our FotoNation imaging technologies, and has expressed interest in certain of our other solutions,” said Jon Kirchner, Tessera’s CEO. “Samsung’s most recent semiconductor patent license expired in December 2016, but we believe it is continuing to use our patented technologies without authorization, and without paying us fair compensation.”
Tessera has requested all products that have used its technologies, including Galaxy smartphones, be banned from entering the U.S. market.
The move came a week after the ITC recommended imposing a 50 percent tariff on Samsung and LG Electronics’ washing machines imports that exceeds 1.2 million units.
“It seems U.S. companies and the U.S. government sees Korean chipmakers making huge profits thanks to the growing global demand for computer chips,” said Koo Tae-un, Tek&Law lawyer. “But actually, U.S. companies are seeing profits similar to Korean companies.”
In fact, U.S. semiconductor integrated circuits have seen a 67 percent increase to nearly $2 billion, while U.S. auxiliary memory imports have seen a 90 percent jump to $1 billion in the first eight months of this year compared to a year ago. Particularly semiconductor manufacturing equipment, which accounts for the largest portion of U.S. imports, has surged 199 percent, to $3.56 billion.
“The Trump administration’s move in protecting its own industry has just begun and it is likely to continue through this administration,” said an official in the Korean industry, who requested anonymity.
BY PARK TAE-HEE, LEE HO-JEONG [firstname.lastname@example.org]