GlobalFoundries sues IBM, says trade secrets were unlawfully given to Japan's Rapidus
Reuters
Published Apr 19, 2023 09:38AM ET
Updated Apr 20, 2023 02:15AM ET
By Jane Lanhee Lee
OAKLAND, California, (Reuters) -Chip manufacturer GlobalFoundries Inc said on Wednesday it had filed a lawsuit against International Business Machines (NYSE:IBM) Corp, accusing it of unlawfully sharing confidential intellectual property and trade secrets.
New York-based GlobalFoundries said in its complaint that IBM had shared IP and trade secrets with Rapidus, a new state-backed Japanese consortium that IBM is working with to develop and produce cutting-edge two-nanometre chips.
It also asserted that IBM had unlawfully disclosed and misused its IP with Intel Corp (NASDAQ:INTC), noting that IBM had announced in 2021 it would collaborate with Intel on next-generation chip technology.
"IBM is unjustly receiving potentially hundreds of millions of dollars in licensing income and other benefits," GlobalFoundries said in a statement.
IBM pushed back in an emailed statement to Reuters saying: “GlobalFoundries filed this meritless lawsuit after a court rejected the company’s attempt to dismiss IBM’s legitimate fraud and breach of contract claims. Their allegations are entirely baseless, and we are confident that the court will agree.”
Intel declined to comment. Rapidus said it is not in a position to comment.
The complaint said GlobalFoundries and IBM had collaboratively developed technology over decades in Albany, New York, and the exclusive right to license and disclose the technology was sold to GlobalFoundries in 2015.
GlobalFoundries is seeking compensatory and punitive damages as well as an injunction against IBM to stop using the trade secrets. It also said IBM has been recruiting GlobalFoundries' engineers - efforts which have accelerated since the Rapidus partnership was announced in December 2022, and asked the court to order an end to those recruitment efforts.
Rapidus, which counts Sony (NYSE:SONY) Group Corp, NEC Corp and other major tech firms as consortium members, is of national strategic importance and has been hailed in Japan as a symbol of U.S.-Japan cooperation.
Japan long ago lost its lead in chip manufacturing, particularly in advanced semiconductors, and is now rushing to catch up and ensure its car makers and information technology companies do not run short of the key component.
Get The News You Want
This is the second time GlobalFoundries has sued IBM since buying IBM's semiconductor plants in 2015.
In 2021, GlobalFoundries asked a judge to rule that it did not violate a contract with IBM which claims it is owed $2.5 billion in damages. That litigation is still ongoing, according to a GlobalFoundries spokesperson.
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.