Green Power Technologies Brings Suit against Infineon

August 10, 2005 by Jeff Shepard

Green Power Technologies Ltd. (GPT, Rehovot, Israel), a power management IC company that designs and develops power-factor correction (PFC) products and power management ICs for the power supply industry, has decided to sue Infineon Technologies AG in a German court over claims that Infineon stole GPT's idea for a product prototype.

GPT CEO Eitan Cohen stated, "At a very early stage, we realized that to make a breakthrough the company needed a large strategic partner, which would manufacture and sell the components in suitable markets. We had a working product prototype that proved the technology. At that point, in 2000, the company had already applied for three patents, and the prototype enabled us to offer the product to large companies."

In 2001, GPT launched a financing round for private investors and signed on Formula Ventures to invest in the company. At the same time, GPT opened negotiations with Infineon. GPT claims that as the two companies were close to signing a draft agreement (after sending Infineon a 180-page draft detailing its core technology, as well as everything needed for design and production, and the signing of a number of confidentiality agreements), Infineon announced that it was closing down the project due to a lack of human and financial resources, effectively ending the relationship in September 2001. GPT changed its business model, decided to launch its own production, and began seeking a partner. It began talks with Delta Electronics Inc. (Taiwan) and an agreement was reached, including the injection of several million dollars into GPT. Delta Electronics withdrew from the agreement when it realized that Infineon had launched a product similar to GPT's at half the price.

Infineon has rejected GPT's allegations, stating, "GPT's allegations are not new, and Infineon rejects them out of hand as groundless." Reportedly, the two companies met twice in Munich, where GPT was offered monetary compensation, which it refused. In 2003, GPT filed papers against Infineon in the Munich Regional Court for breach of a confidentiality agreement and unfair competition. Infineon filed a lawsuit in the US Federal Court for the District of Columbia against GPT's patents in response, for allegedly being inadmissible. The two cases have been proceeding in parallel over the past 18 months. In April 2005, the Munich Regional Court appointed a technical expert to advise the judges; a ruling will take from three to six months after the expert gives his opinion to the German court. During proceedings in the US case, confidential Infineon documents were discovered that indicate that there are grounds for GPT's claims. The US court ruled in favor of sending the documents to the German court, despite Infineon's objection.