Taiwan Semiconductor Manufacturing Co. and its Shanghai-based rival, Semiconductor Manufacturing International Corp., don’t care much for each other. Back in 2005, the smaller Chinese company paid $175 million to the Taiwanese company in a trade secrets dispute. But TSMC later called foul when SMIC allegedly violated the terms of the settlement, and the two went back to court. The dispute over the settlement agreement is now being heard by a jury in California’s Alameda County superior court. The trial, expected to last 50 to 60 days, can be viewed live at Courtroom View Network, which is also offering free clips of the proceedings.
David Lammers of Semiconductor International magazine was on hand for the opening arguments last Wednesday. According to his comprehensive article on the case, Jeffrey Chanin of Keker & Van Nest, representing TSMC, told the jury that SMIC executives violated the 2005 settlement deal when they instructed staff to destroy documents related to TSMC rather than preserve them in a document bank.
But SMIC’s lawyer, David Steuer of Wilson Sonsini Goodrich Rosati, argued that TSMC’s renewed case is a disguised effort to try to ruin his client. He accused TSMC of failing to make good faith efforts to resolve its differences with SMIC, as required by the 2005 settlement agreement, and promised to show the jury evidence that TSMC wants to destroy SMIC because it hasn’t been able to start an operation in China, where SMIC has become a major player.
“This case is all about China,” Steuer said.
This article first appeared on The Am Law Daily blog on AmericanLawyer.com.