U.S. semiconductor manufacturing equipment company Applied Materials has been sued for allegedly stealing trade secrets from a Chinese competitor.
According to Bloomberg News on 14th, Beijing E-Town Semiconductor Technology (E-Town) claimed in a lawsuit submitted to the Beijing Intellectual Property Court that Applied Materials unlawfully acquired, used, and leaked its core technology. The disputed technology is related to 'plasma source coating' in the semiconductor wafer surface treatment process, and E-Town stated that Applied Materials accessed this technology by hiring two former employees of its U.S. subsidiary, Mattson. These employees had access to the proprietary technology.
Afterward, Applied Materials applied for a patent with the Chinese authorities, claiming the technology was invented by them, but E-Town alleges that the application included trade secrets co-owned by E-Town and Mattson.
E-Town emphasized, "The patent application violated China's anti-unfair competition law and caused significant damage to the plaintiff's intellectual property rights and economic interests due to trade secret infringement." It also added that Applied Materials is suspected of promoting and selling the technology to Chinese customers. Accordingly, E-Town is seeking a prohibition on the use of trade secrets, the destruction of related materials, and approximately 100 million yuan (about 19.2 billion won) in damages.
Bloomberg noted that this lawsuit could escalate the technology war between the U.S. and China, pointing out that semiconductor equipment technology is a key area of competition between the two countries. The semiconductor equipment industry, currently dominated by the U.S., Netherlands, and Japan, is one area where the U.S. is attempting to decouple China from the supply chain for national security reasons. Due to these regulations, China has been struggling for years to secure advanced extreme ultraviolet (EUV) lithography equipment from the Netherlands' ASML.
Bloomberg also highlighted that E-Town's actions may be perceived as a retaliation by China against U.S. regulations, but both companies have already been involved in another dispute. Applied Materials previously sued E-Town's subsidiary Mattson in 2022 on charges of industrial espionage. Applied Materials has not commented on this matter.