Another Taiwanese LED manufacturer aside from Everlight has joined in patent wars against Nichia, this time Harvatek Corporation (Harvatek), according to a report by Taiwan's Science and Technology Policy Research and Information Center (STPI). The company has reignited patent wars against Nichia on Nov. 5, 2013. Harvatek filed a complaint against Nichia and its U.S. subsidiary Nichia American Corp. (Nichia) that their LED products had infringed its patents at the U.S. District Court Eastern District of Texas Tyler Division. The Taiwanese company has also asked the court to ban Nichia's infringement action and demanded compensation from the Japanese company.
Although, Nichia is the defendant in this case the company has been very active in initiating patent lawsuits. Not only does the company often separate patents to extend its reach, the company also informs the defendant's clients during lawsuits to affect the other party's capability of receiving orders. When Nichia sued Harvatek at the German Dusseldorf Court in 2010, in an attempt to affect the company, the Japanese company notified Haravatek clients about the case. Nichia won the first trial in the German court, but Harvatek appealed the case and the case is currently under second trial.
Harvatek's recent lawsuit against Nichia in the U.S. is probably to protect its patents and not out of market consideration. For the Taiwanese company, the U.S. is not its main market and only accounts for 4 percent of annual sales revenue, while the Asian market accounts for 67 percent of annual revenue. Even if Harvatek wins the lawsuit in U.S., its market share in the country is unlikely to rise significantly. In contrast, the U.S. market is a major market for Nichia, and the damage will be greater for the Japanese company if it loses this case. Therefore, Harvatek's main aim in suing Nichia is to increase its negotiation leverage during patent lawsuits.