A123 Negotiating To Settle Dispute Over Lithium Battery Patents; Announces Closing of IPO
According to media reports, automotive lithium battery maker A123 Systems Inc. is participating in talks to resolve a patent dispute with the University of Texas and Hydro-Quebec over technology at the heart of A123 products.
The parties "continue to engage in ongoing settlement discussions that may resolve the issues in dispute in this matter," A123 said in a Sept. 15 court filing. Shares of the company soared 50% in the first day of trading on optimism A123 will benefit from the American emphasis on battery-powered vehicles.
The University of Texas (Austin) and Hydro-Quebec, Canada’s largest utility, filed suit against A123, Black & Decker Corp. and China BAK Battery Inc. in 2006, claiming that the companies were using university inventions in Black & Decker’s DeWalt cordless power tools. A123 sued Hydro-Quebec, seeking to invalidate the patents or get a ruling stating that the inventions weren’t incorporated in A123’s battery technology.
Both cases were put on hold while the U.S. Patent and Trademark Office reviewed the patents. The patents were then reissued with some alterations. The companies are contending over whether the dispute, if revived, should be handled in federal court in Dallas, where the university’s suit was filed, or in Boston, where A123 sued Montreal-based Hydro-Quebec.
In a recent regulatory filing, A123 stated that it could be forced to pay "substantial damages" if the case isn’t resolved in its favor.
A123 also announced that it has closed its previously announced initial public offering of 32,407,576 shares of common stock at a public offering price of $13.50 per share. The company sold 31,727,075 shares and selling shareholders sold 680,501 shares. The sales included all shares subject to the underwriters’ over-allotment option.
