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Canon's loss of SED tech patent license may cost it millions

28 February 2007 8:27 by James "Dela" Delahunty | 5 comments

Canon Inc. recently lost a license to an important patent related to surface-conduction electron-emitter display (SED) flat panel TVs. The Japanese firm originally paid $5.6 million for the patent license, which is a deal considering Canon planned to enter the $84 billion global flat-panel TV market using the technology. However, the firm made its first mistake by forming a joint venture with Toshiba to produce SEDs.

The US-based owner of the patent, Nano-Proprietary Inc. contested that the license held by Canon did not extend to Toshiba, and in an attempt to resolve the situation, reached out to Toshiba to strike a separate license agreement. Canon made another mistake then by blocking talks between Toshiba and Nano-Proprietary.

Canon claimed that the joint venture with Toshiba was in fact, a subsidiary of Canon because the firm's 50% stake included one more share than Toshiba's stake. Nano-Proprietary sued Canon in April 2005, pitting itself against a company that has $35 billion in annual revenue as well as 500 employed intellectual property experts.

In an attempt from Canon to resolve the situation, the company decided to buy Toshiba's stake, but Judge Sam Sparks of Texas said the move came too late from Canon. The two sides are now reportedly working to reach a settlement before a court decision on damages due to Nano-Proprietary.

"It seems strange Canon managed to go all the way to trial and lose," said Peter Godwin, a Tokyo-based partner at law firm Herbert Smith. "Assuming they were advised they were at risk, you'd expect a company of the size of Canon to have reached a settlement before that."

Canon and Nano-Proprietary would now have to reach a new licensing deal, which is expected to cost many millions more than the original deal and could be on a "pay as you use" basis, having a huge impact on Canon's profitability. If rumors are true, Samsung may have also recently approached Nano-Proprietary to get access to SED technology.

"We will talk to Canon, Toshiba, Samsung or any interested party regarding SED licensing agreement on a non-exclusive or exclusive basis," Nano-Proprietary spokesman William Spina said.

Source:
Reuters

Permalink to this article

RD&IP aim to reduce costs of FED and SED (6 October 2007)

Canon plans to appeal SED decision (30 March 2007)

Canon loses court case over SED technology (23 February 2007)

Canon to team up with Toshiba in flat panel TV market (3 October 2006)

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Discuss this article!
rosedog (Member) 28 February 2007 11:39
pwnage [ + quote]
ZippyDSM (AfterDawn Addict) 28 February 2007 17:49
If I am reading this right cannon didn't want to play nicely with Toshiba and tried to take its toys away and lost and had some of tis toys taken away because they were being mean? [ + quote]
Zippy84 (Junior Member) 1 March 2007 6:55
hahaha.... keep your friends close and your enemies closer...nice job Cannon.... dumbasses [ + quote]
jakewash (Junior Member) 3 March 2007 6:00
Actually it sounds to me like Nano were the ones looking to gain from the upcoming new TV's and decided to force the issue, as they were the antagonists in the article. Just couldn'r handle the fact Canon was going to do something with their technology that they alone couldn't and they would miss out on some big bucks. I can't blame them. [ + quote]
ZippyDSM (AfterDawn Addict) 3 March 2007 6:08
Originally posted by jakewash: Actually it sounds to me like Nano were the ones looking to gain from the upcoming new TV's and decided to force the issue, as they were the antagonists in the article. Just couldn'r handle the fact Canon was going to do something with their technology that they alone couldn't and they would miss out on some big bucks. I can't blame them. so its SED whos trading toys for favors eh? :P [ + quote]