Japan’s JSR is in patent dispute with American university over breakthrough chip technology

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A multibillion-dollar patent battle has erupted over a technology that could transform the future of chip manufacturing, pitting the State University of New York against a company expected to be owned by a Japanese government-backed fund.

The university’s research foundation alleges that Inpria, a U.S. subsidiary of Japan’s JSR, sold chip materials products based on technology invented by one of its professors, according to a document filed last week. It could seek damages of up to $4.3 billion for alleged infringement of its intellectual property.

The legal battle erupted as JSR is seeking to acquire a state-backed fund in a controversial deal that has raised questions about whether Japan is entering a new era of state interventionism to protect strategically important technologies.

JSR is a leading supplier of photoresists (specialized chemicals used for printing circuit designs onto chip wafers) to the world’s largest chip manufacturers, including Samsung Electronics, Taiwan Semiconductor Manufacturing Company and Intel.

At the center of the intellectual property dispute is technology marketed by Inpria, a chemical materials start-up out of Oregon State University that JSR acquired for $514 million in 2021.

The company is known for its metal-containing photoresists, which researchers see as a potential game-changer for the development of highly sophisticated and cost-effective extreme ultraviolet (EUV) lithography machines critical to high-end chip production .

Analysts believe the technology Inpria is working on is one reason the Japanese government wants to prevent JSR from falling into foreign ownership.

The complaint filed in the U.S. District Court in New York alleges that metal oxide resistors were originally invented by research foundation professor Robert Brainard and his team. It accuses Inpria of selling products and filing new patents using its intellectual property – valued at between $2.4 billion and $4.3 billion – in violation of a contract signed between the foundation and JSR’s subsidiary.

It also seeks a preliminary injunction to prevent JSR and Inpria from continuing with their alleged activities and seeks the creation of an escrow account to ensure its financial claims are protected even after the state-backed Japan Investment Corporation , will launch its $6.4 billion bid for JSR. already this month.

Pointing out that the JIC deal is expected to be completed in early March, the document states: “In less than five weeks, Inpria and its parent company, JSR, will seek to make it impossible to correct these errors.”

The State University of New York lawsuit highlights what it says are prior claims by JSR and JIC that call into question whether the research foundation would still be able to pursue legal action against Inpria once JIC acquires JSR.

A person close to JSR said the company had not previously suggested it would be outside the jurisdiction of US courts and that Inpria’s intellectual property was not expected to be transferred to either JSR or JIC.

The research foundation said it became aware of its intellectual property issue with Inpria when a patent legal dispute erupted between Inpria and chip-making equipment supplier Lam Research in October 2022. It notified Inpria that it was considering legal action last November, shortly before JSR approached. JIC for a “take-private” agreement.

In an emailed statement, JSR said it considered the lawsuit to be without merit and that its internal investigations had not uncovered any improper activity involving Inpria or implicating JSR.

“The patents in question are part of patent families filed prior to JSR’s full acquisition of Inpria in 2021,” the company said.

“Inpria is a former university spin-out with deep roots in academic metal oxide research dating back two decades,” he added.

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