TSMC’s allegations are baseless, says SMIC chief

Allegations that contract chip maker Semiconductor Manufacturing International Corp. infringed on chip-making patents held by rival Taiwan Semiconductor Manufacturing Co. are baseless, SMIC’s top executive said Friday.

SMIC has not violated the intellectual property rights of any company, said Richard Chang, the company’s chairman, CEO and president. “We do not have the need to do so either,” he added.

Last year, TSMC sued SMIC in the U.S. District Court for the Northern District of California. It alleged that SMIC had infringed on five TSMC patents and misappropriated trade secrets. The lawsuit seeks monetary damages and an injunction against SMIC.

On Aug. 18, TSMC expanded that lawsuit by filing a complaint with the U.S. International Trade Commission (ITC). The ITC complaint alleged that SMIC misappropriated trade secrets and had infringed on three additional patents. The lawsuit seeks an injunction to ban the import of certain SMIC products into the U.S.

TSMC also filed a patent-infringement suit in the U.S. District Court for the Northern District of California over the three patents.

While some observers may assume that the allegations made against SMIC are true, an examination of the facts will show the company is innocent of these charges, Chang said.

Despite the ongoing legal battle, Chang expressed his support for TSMC’s plans to begin production at a 200-millimeter chip fabrication plant outside Shanghai, saying he opposed Taiwanese government restrictions that limit semiconductor-related investments in China. SMIC is based in Shanghai, and TSMC in Hsinchu, Taiwan.

He also had a few words of praise for TSMC Chairman Morris Chang, who is credited for leading the development of the contract chip-making industry. The two men are not related.

“In this industry, he is a great person. He’s a pioneer,” SMIC’s Chang said. “We really respect him.”