UK computer chip firm files lawsuit against rival firm amid £4bn takeover
One of the UK’s largest computer chip manufacturers has filed a US lawsuit against an Israeli rival semiconductor company which is currently undergoing a billion-dollar takeover.
London-listed IQE has accused Tower Semiconductor of “unlawfully” getting hold of IQE’s patents for its silicon technology, which is used in 5G tech.
Patrick Wheeler, committee member of the London Solicitors Litigation Association, told City PM: “The location of a court claim can be used to send a message to others, such as customers or shareholders of a defendant. It may therefore be significant that Intel is in the process of acquiring Tower for $5.4bn (£4.4bn).”
But ultimately, “English laws and courts are well able to deal with all of the elements of this sort of claim, but other factors have probably tipped the balance in favour of California,” Wheeler added.
“Tower has major manufacturing facilities in both California and Texas and the reference to Tower obtaining a patent may suggest that the first patent application that is being challenged was filed in the US.”
Semiconductors are used in much of today’s electronics, including electric vehicles, but are currently in short supply due to a rapid acceleration of tech buying during the pandemic.
The British company, founded in Cardiff in 1988, has used Californian law to file its complaint under the misappropriation of trade secrets, correction of inventorship, breach of contract, unfair competition, and intentional interference with prospective economic advantage.
“We brought about these claims as we have significant reason to believe that Tower has misappropriated IQE’s proprietary trade secrets for its own benefit,” general counsel and company secretary, Tom Dale, said in a statement this morning. “Our technology, processes and intellectual property are vital in underpinning IQE’s products and solutions and in maintaining our market-leading position in advanced semiconductor materials.
“We will vigorously protect them and will provide further updates as material developments occur.”
A Tower spokesperson said: “Tower strongly rejects IQE’s baseless claims. Tower did not misappropriate any trade secrets and is the rightful owner of all of its patents. Tower is disputing these claims in court to protect its rights and intellectual property.
“Additionally, although Tower has every right to do so, Tower does not use porous Silicon technology for any of its customers or in any of its production flows.”