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Federal Court Finds That Fairchild Willfully Infringed Power Integrations Patents

July 27, 2010 by Jeff Shepard

Power Integrations announced that a federal district court has found that Fairchild Semiconductor willfully infringed its patents. Fairchild was found to infringe four of the company’s patents following a jury trial in October 2006; the jury rejected Fairchild’s challenges to the validity of the patents in September 2007; the court rejected Fairchild’s enforceability challenges in September 2008; and the finding of willfulness follows a bench trial conducted in June 2009. The infringement was found to be willful on each of the four patents involved in the case.

In its ruling, the U.S. District Court for the District of Delaware found that Power Integrations presented "overwhelming evidence" of willful infringement, and that Fairchild "engaged in the blatant copying of Power Integrations’ patented features." The court further noted that Fairchild recognized the importance of Power Integrations’ patents to the industry, describing them internally as "key patents" with "epoch making" technology.

In December 2008, the Court awarded Power Integrations $6.1 million in damages plus interest based on the initial finding of infringement. Based on the finding of willfulness, Power Integrations now intends to seek enhancement of the damages as well as compensation for attorneys’ fees. A permanent injunction against more than 100 infringing Fairchild products, originally issued by the Court in December 2008, remains in effect. The results of the case remain subject to appeal.

Commented Balu Balakrishnan, President and CEO of Power Integrations: "We are gratified that the Court has found Fairchild’s infringement to be willful, and we now intend to seek maximum financial compensation. We are the leaders in our market thanks to more than 20 years of intense innovation and investment, and we expect our competitors to respect the intellectual property embodied in our patents."

Two separate lawsuits filed by Power Integrations against Fairchild in May 2008 and November 2009 remain pending. The suits allege infringement of five Power Integrations patents, including two of the same patents now found by the District Court to have been willfully infringed. The company is seeking additional damages as well as injunctions against the infringing Fairchild/System General products not subject to the existing injunction.

Fairchild announced that it expects to appeal the federal court’s decision. Fairchild states that the ruling has no impact on Fairchild’s business since it voluntarily stopped U.S. sales of affected products in 2007, replacing them with products that Power Integrations agrees do not infringe the asserted patents.

Fairchild said it was disappointed by the willfulness ruling because it is inconsistent with repeated rejections of Power Integrations patents by the U.S. Patent Office following re-examinations that were launched by Fairchild. In that process, Power Integrations has even cancelled one of the patent claims found to have been willfully infringed in the court process.

Fairchild maintains that its products do not violate Power Integrations patents and that it respects the intellectual property rights of its competitors.