Cal. Judge Rejects Injunction in Lexar-Toshiba Case
A Cal. Superior Court judge rejected Lexar’s request for an injunction barring shipment of Toshiba-made flash memory products, saying the company was “adequately compensated” by a jury’s award of $465 million in damages this year.
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Judge Jack Komar, Santa Clara, ruled that Lexar failed to provide “specific evidence” that Toshiba and partner SanDisk enjoy a “commercial advantage” beyond that covered by the jury award. A Superior Court jury capped a 6-week trial by awarding Lexar $465.4 million, finding Toshiba stole flash-related trade secrets involving CompactFlash, Secure Digital, xD and NAND. Lexar sued Toshiba in 2002, alleging theft of trade secrets and breach of fiduciary duty in connection with Toshiba’s 1997-1999 representation on its board. Toshiba makes 70- 75% of SanDisk’s flash memory products through a Flash Vision joint venture dating to the late 1990s. Samsung supplies the rest.
“The multiple other parties who are innocently intertwined in the defendant’s products, as either joint ventures, purchasers or contractors, would make it unreasonable to require that all production or sales cease,” Komar wrote. “Since there is no basis for injunctive relief as sought, the court need not look to which products would be subject to royalty awards, the length of such awards, or the amounts of such royalties.”
Komar also said there is “no longer any possibility” that Toshiba could breach its fiduciary duties since it no longer has representation on the company’s board.
In a statement, SanDisk Vp-Gen. Counsel Charles Van Orden said the company is “pleased” with Komar’s decision. “We have always believed that there was no legal basis for the requested injunction,” he said. Lexar officials weren’t immediately available for comment.
Meanwhile, a U.S. appeals court late last week reinstated a patent infringement suit SanDisk filed in 2001 against Memorex Products Corp., Pretec Electronics Corp. and Ritek. The U.S. Appeals Court, Federal Circuit, overturned U.S. Dist. Judge Vaughn Walker’s dismissal of the suit in 2003 and 2004, ruling the decision was based on “erroneous claims construction.” A 4th company -- Power Quotient -- originally was included in the suit but that complaint later was dismissed.
In its 2001 suit, SanDisk alleged the plaintiffs’ flash memory devices violated a patent covering the Flash EEprom system and granted 4 years earlier, describing methods for using EEproms as nonvolatile solid state computer memory. The flash memory had many applications, including digital cameras and audio players.
Walker found that every memory cell in a device was grouped into a sector partitioned into user and data overhead portions, but the appeals court backed SanDisk’s contention that the judge misread the claims. The patent requires only that a memory system contain some memory cells, grouped into sectors, partitioned into user and overhead data portions, the court said. “Nothing in the claims precludes additional memory cell configurations, which need not contain such partitioned sectors,” the court stated. The invention described in the patent uses “non-restrictive terminology” that doesn’t foreclose “additional elements that need not satisfy the stated claim limitations,” the court said.