Monolithic Power Systems Announces Developments in Taiwan Sumida Electronics Case
Monolithic Power Systems Inc. (MPS) announced that orders have been issued by the Northern Federal District Court in response to the summary judgment motions of both parties in the Monolithic Power Systems, Inc. v. Taiwan Sumida Electronics, Inc. ("TSE") case.
The parties will proceed to trial, which is scheduled to begin on August 13, 2007, solely on TSE’s counterclaim for breach of the covenant of good faith and fair dealing. The Court disposed of all other claims in a judgment as a matter of law in TSE’s favor. Under the order, MPS will be liable for damages and attorneys’ fees in an amount not known with precision, but which appears to be approximately $2.0 million. The order also requires MPS to assume responsibility for a liability of approximately $7.0 million, which TSE incurred in November 2005 and that the Court ruled is covered by the parties’ indemnity agreement, in the event that liability becomes payable. This liability, however, is subject to an appeal. MPS intends to defend itself at trial with respect to the remaining claim, and is exploring all options, which include appealing the ruling with regard to the claims decided by the Court as a matter of law.
As a result of this ruling, MPS expects to take a one-time provision for litigation and related litigation expense of approximately $9.0 million for the second quarter of 2007.