Counteroffensive
Samsung Display has filed a patent infringement lawsuit in the U.S. against Chinese display manufacturer BOE. As technology infringement from China intensifies, spreading to appliances, smartphones, and now displays, Samsung Display has decided to take a firm stand.
According to the industry on July 2, Samsung Display filed a patent infringement lawsuit against BOE in the Eastern District Court of Texas, the U.S., on June 26 (local time) for smartphone OLED patents. This is the first time Samsung Display has sued BOE for patent infringement.
Samsung Display claims that BOE’s OLED panels for the iPhone 12 to 14 infringe on a total of five of its patents, including its unique technology known as the Diamond Pixel structure and related driving technologies. Diamond Pixel technology, which improves image quality by constructing subpixels of a display pixel in a diamond shape, was first used in the Galaxy S4 series in 2013 and has since become a key technology of Samsung OLED panels.
This lawsuit began when it was discovered that BOE had sold these panels to American iPhone repair businesses. Similarities between the Chinese panels and the genuine panels from Samsung Display were found during the repair process.
Following this, in December of last year, Samsung Display filed a complaint with the U.S. International Trade Commission (ITC) requesting that 17 American panel suppliers be prevented from importing “fake panels” from China. The strategy was to sift through the right and wrong in the U.S., where the patent rights protection system is relatively well-established compared to China. In May, Choi Kwon-young, vice president of Samsung Display, stated that “We sued 17 parts wholesalers in the U.S. at the ITC,” and “We plan to further expand legal measures to protect our patent assets from this lawsuit.”
In February, BOE, which was initially not the subject of the investigation, voluntarily responded to the ITC investigation and became a defendant, but soon began to counterattack. Four Chinese companies, including BOE, have requested an Inter Partes Review (IPR) from the U.S. Patent Office regarding Samsung’s Display patents. In addition, in April, BOE filed a lawsuit at the First Intermediate People’s Court of Chongqing, China, claiming that seven entities including Samsung Electronics and Samsung Display's Chinese branch infringed on five of its patents related to OLED panel structure.
Industry insiders and patent experts interpret BOE’s rash litigation as an attempt to hamstring Samsung. A lawyer who wished to remain anonymous stated, “Samsung Display's filing of a lawsuit in a U.S. court also implies a determination to put a damper on BOE’s eye-for-an-eye response.”
There’s also the concern that China could usurp technology leadership in OLED after LCD. The industry cites the nightmare of HYDIS, which was separated from Hyundai Electronics’ LCD business, as a lesson in technology leakage. HYDIS was later sold to BOE, which, it is said, leveraged the technology HYDIS possessed to dominate the LCD market.
The OLED market is showing a similar trend as the LCD market did. According to the Korean Display Industry Association, the market share gap between Korea and China in the small-medium sized OLED market was 91.9% points in 2018 (Korea 95.5%, China 3.6%), but last year it narrowed to 59.1% points (Korea 79.1%, China 20%).