Sony settlement only palpable result for tech firm

By Kim Yoo-chul

This year, LG Group may be more preoccupied in the patent litigation front with precarious prospects.

Its export-driven affiliates such as LG Electronics, the group’s display-making unit LG Display, the component affiliate LG Innotek and the group’s rising cash-cow LG Chem have spent millions of dollars on separate patent disputes, according to group officials.

The efforts haven’t yielded successful returns.

``When we talk about patents, the formula is that money talks. LG is not doing as well as Samsung, which is engaged in a global war against Apple,’’ said an LG executive, asking not to be identified.

Its settlement with Japan’s electronics giant Sony is so far the only one case that was worthwhile.

LG and Sony have settled 24 intellectual property disputes, agreeing to cross-license patents instead after LG had filed a complaint about Sony’s PlayStation 3 infringing on its Blu-ray technology that led to the gaming consoles being held for ten days by customs officers in the European Union.

LG Electronics spokesman Yoon Won-il declined to unveil details of the terms. Hong Ji-eun, an Sony spokeswoman declined to comment.

LG is pinning high hopes on securing royalties from U.S.-based appliances giant Whirlpool from a separate legal battle after the U.S. Patent and Trademark Office (USPTO) rejected Whirlpool’s claims that it had invented the concept for a type of refrigerator dispenser earlier than the Korean firm.

However, the company has failed to be awarded compensation from other major cases.

It sealed an agreement with Microsoft (MS) to provide extended coverage underneath MS’s portfolio for tablets and Chrome software.

Under the contract, LG is paying $3.75 for unit sales of its MS software-embedded tablets or smartphones, according to company sources though its spokesman declined to confirm.

LG Electronics is also paying a series of fixed cash payments to Wi-LAN technology for the use of its wireless technology.

Meanwhile, LG is seeking a complete sale ban of BMW and Audi cars in Korea as it believes Osram infringed on its patents that include LED chips and packaging technology.

To effectively handle the issue, it has formed an alliance with LG Innotek.

``It’s hard to imagine that courts will grant such a wide-sweeping ban on major automakers’ bread and butter. But we are aiming to show our capability to receive royalties, not just for paying royalties in the Osram case,’’ said another LG executive requesting anonymity.

The conglomerate is therefore looking more and more desperate in light of all of these patent-related lawsuits, especially in rising technologies such as car batteries.

LG Chem, the world’s top maker of lithium-ion batteries used in hybrid electric vehicles, is in an intensive court battle with SK Innovation over battery-related patents.

``In car batteries, there is room for LG Chem to receive more compensation as we came into the market earlier and have better capabilities to mass-produce batteries than other companies,’’ said LG Chem spokesman Song Choong-sup.

The affiliate has some 40 patent experts, according to Song.

The world’s biggest flat-screen manufacturer, LG Display, is involved in a court battle with a Taiwanese LCD maker and company spokesman Gary Sohn said its 70 patent experts are already handling the case.

``LG has been aggressive in various patent litigations. With the group’s nine affiliates, LG has formed a single board,’’ said a group spokesman.

Data from IFI Claims Patent Services shows LG filed for 1,411 patents in the United States, last year, ranking the world’s 12th-largest patent holder.

``LG will increase the number of patent experts to 260 by the end of next year from some 200 as of the end of the second half of last year. We are looking to hire more lawyers and technology experts,’’ said the group spokesman.