USITC sides with SK in battery patent suit with LG

SK says ITC decision shows firm's technological capabilities

LG claims latest ruling is separate from trade secret case

By Kim Bo-eun

LG and SK groups' corporate logos / Korea Times file

The U.S. International Trade Commission (USITC) ruled in favor of SK Innovation (SKI), Wednesday (local time), in a battery patent lawsuit with LG Energy Solution (LGES).

In a preliminary decision in the patent suit filed by LGES, the commission stated that it could find no evidence that the nation's No. 2 battery maker, SKI, infringed on the stated patents. The pre-ruling comes as a deadline approaches for a decision by the White House on whether to veto a separate USITC ruling over SKI illegally obtaining LGES' trade secrets that was made in February.

"It is my initial determination in this investigation that there is no violation of section 337 of the Tariff Act of 1930, in the importation into the U.S., the sale for importation, and/or the sale within the U.S. after importation of certain lithium battery cells, battery modules, battery packs, components thereof and products containing the same, with respect to the alleged infringement of asserted claims (of the four patents)," the notice signed by Administrative Law Judge Dee Lord stated.

LG Chem, which owns LGES, filed the battery patent suit against SKI in September 2019, claiming the SK affiliate infringed on its patents in the U.S. involving separators and cathode materials.

This is a preliminary determination and the final ruling is due Aug. 2.

SKI welcomed the ITC's decision, saying, "We have been developing advanced battery technology over an extended period of time, and therefore anticipated that the ITC would rule that no infringements were made (on LGES' patents). The preliminary ruling shows SKI's technological capabilities."

In a statement, LGES, said, “We plan to look into the details of the initial determination and take measures according to procedures of the suit so that the infringements and validity of our patents are recognized."

Noting that the ITC's patent suit is separate from its trade secret case with SKI, an LGES official said that it will make further efforts to prove SKI infringed on its battery technology patents.

The U.S. International Trade Commission's headquarters in Washington D.C. / Korea Times file

The USITC's final ruling is made based on the initial determination. In about 90 percent of the commission's final rulings on patent infringement suits, the pre-ruling has been upheld. The USITC also upheld its initial determination in the suit on the violations of trade secrets. An appeal can be filed against the USITC's final rulings.

The patent suit is related to the claim LGES filed against SKI over the violation of 22 trade secrets, for which the USITC ruled Feb. 10 in favor of LG. The ruling has entailed a 10-year import ban of SKI's lithium-ion batteries. The commission did allow, however, temporary permits for SKI batteries and components that Ford and Volkswagen need to manufacture their EVs, to enable the carmakers time to find new vendors.

The import ban will go into effect unless the ruling is overruled by the White House, which is possible based on policy grounds. U.S. President Joe Biden is able to veto the ruling within 60 days, making April 11 the deadline. Although rare, there have been such precedents.

Following the news of the USITC's pre-ruling, SKI's stock price jumped 10.27 percent, closing at 241,500 won, Thursday. LG Chem's stock closed at 819,000 won, up 1.74 percent from the previous day's close.