Philips Frustrated in CD-R Royalty Lawsuit Against DST

Wednesday, February 15, 2006

Philips Frustrated in CD-R Royalty Lawsuit Against DST

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Taiwan?s Supreme Court recently sent back for retrial by Taiwan?s High Court a civil lawsuit filed by Philips against Taiwanese manufacturer Digital Storage Technology (DST) for violating licensing agreements for CD-R discs.

Philips will review the decision and then make an appeal, according to the Taiwan Office of Philips Intellectual Property & Standards.

DigiTimes.com reports that DST, a Taiwan-based manufacturer of CD-R and DVD-R media, had signed a license agreement with Philips in July 2001 to use CD-R patents at a royalty charge of US$0.06 per disc. DST defaulted on the royalty payments resulting in Philips taking legal action against the Taiwanese maker. Philips won the lawsuit at a district court and Taiwan?s High Court but lost in DST?s appeal to the Supreme Court.

CMC and Ritek, the top makers of optical discs in Taiwan, are watching the case carefully for reference in negotiating royalty payments with Philips.