Lawsuit in the Semiconductor Industry That Can Become a Global Challenge!
Sep 21, 2019

Lawsuit in the Semiconductor Industry That Can Become a Global Challenge!

Global Foundries, one of the leading companies in the semiconductor and electronic chips industry, has sued Taiwan's rival, TSMC, for ​​infringing its intellectual property rights. The lawsuit is filed in Germany and the United States, due to the company’s offensive IP policies. Global Foundries has requested to prevent manufacturing and importing patent infringed products to mentioned countries and it will make huge effects on entire consumer electronics industry.

Interestingly, TSMC has a significant market including some of the world's most well-known technological companies like Mediatek, Qualcomm, nVidia and even some of the consumer products manufacturers, such as Apple, Google, Motorola, and Cisco. It is possible that the lawsuit affect on the mentioned companies. Global Foundries’ lawsuits filed in Texas and the District Courts of Düsseldorf and Mannheim, and it is claimed that 16 patents related to manufacturing process of 7, 10, 12, 16 and 28 nm chips are infringed.

Last year, Global Foundries went out of the competition to produce 7 nanometer chips and virtually loosed the market to Asian competitors such as TSMC and Samsung. At the same time, AMD, as one of the key customers of Global Foundries, announced changes in its policy for supplying 7 nm chips from TSMC.

Because of significant advantages of smaller chips, especially in terms of performance and energy consumption, TSMC upgraded its production technology from 10 nm to 7 nm in recent years and even the company has been starting efforts for accessing to 5 nm chips. In the meantime, Global Foundries has accepted dominance of its competitor and has been following the last possible path, infringing the competitor in different cases and receiving some compensation.

It should be noted that the risk of this strategy is insignificant for companies such as Apple and Qualcomm, but according to selected courts it seems that the mentioned companies will face some difficulties. Apple recently faced similar problem in the US and German courts following the Qualcomm lawsuits that banned the import of iPhone products, but these problems were solved by two companies' agreement.

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