[Patent Talk] How Strong Small and Mid-sized Materials, Parts and Equipment Companies Can Survive Patent Disputes...

As the number of strong small and mid-sized Korean companies in semiconductor materials, parts and equipment (the 'MPE' sector) grows, foreign companies are actively securing patents in Korea, and patent litigation in Korea is increasing accordingly. One example is the lawsuit filed last October by Lam Research of the US, the world's fourth-largest semiconductor equipment maker, against the Korean semiconductor equipment company PSK, alleging infringement of three of its patents. PSK filed invalidation trials against the three asserted patents. Reportedly, one was held invalid, one was held valid, and the remaining one is still under review.

The Korea Semiconductor Industry Association is concerned that, because Korean MPE companies are latecomers, an increase in patent litigation based on foreign companies' pioneering patents could seriously disrupt Korean companies' businesses. In fact, once patent litigation begins, it is not uncommon for companies that are supplied with the accused company's products to suspend deliveries until the outcome of the litigation is known.

When patent litigation begins, the basic countermeasure is to file an invalidation trial against the patent in suit. Because the outcome of an invalidation trial cannot be predicted, the infringement litigation continues to be fought separately. In patent litigation, developing non-infringement arguments and design-arounds are key elements. All of the amendments and written arguments submitted by the applicant during prosecution are reviewed to determine whether the scope of the registered claims can be construed narrowly. If a non-infringement point is found in this process, the litigation can turn in your favor.

However, unless a non-infringement point is very strong, a design-around is often pursued, because products are often difficult to supply while an infringement risk exists. In such cases, it is advisable to file patent applications for the designed-around products as well and to establish a roadmap for future design changes by checking the expiration dates of the asserted patents.

The most frustrating situation is one in which there is no non-infringement point and a design-around is practically impossible. In that case, the only way out is...