Micron settles IP theft lawsuit amid push to repair Beijing ties

Micron Technology Inc. has settled a high-profile intellectual property theft lawsuit with a key, state-backed Chinese rival amid the US company’s efforts to mend ties with Beijing. 

Micron said it has reached a global settlement agreement with Fujian Jinhua Integrated Circuit Co.“The two companies will each globally dismiss their complaints against the other party and end all lawsuits between them,” a Micron spokeswoman said in an email, declining to provide further details. 

Fujian Jinhua did not immediately respond to an email seeking comment outside of office hours. 

The settlement comes months after the Chinese government in May barred Micron’s chips from “critical infrastructure” over cybersecurity concerns. The US too has been working with allies to prevent Beijing from obtaining the most advanced semiconductors and the latest chipmaking technologies. 

Micron in June warned that about half of its sales tied to China-headquartered clients may be affected by Beijing’s move, representing a “low-double-digit percentage” of its global revenue. The US firm said then about a quarter of its global revenue came from businesses based in mainland China and Hong Kong.  

Micron appears to have attempted to pacify Beijing, including promising to invest another 4.3 billion yuan ($602 million) in its Chinese chip-packaging plant and sending Chief Executive Officer Sanjay Mehrotra to visit the world’s second largest economy. 

In 2017, Micron sued Fujian Jinhua and its Taiwanese partner United Microelectronics Corp. in the US, accusing the two of stealing the Boise, Idaho-based company’s memory chip trade secrets. 

A year later, Fujian Jinhua and UMC were charged with conspiring to steal trade secrets from Micron as the Justice Department steps up actions against China in cases of suspected economic espionage. The Trump administration added Fujian Jinhua to the so-called entity list, blocking sales of American components to the Chinese chipmaker. 

UMC has since settled with Micron and pleaded guilty in a deal with U.S. prosecutors, who agreed to drop serious charges of economic espionage and conspiracy for the alleged IP theft. However, the Justice Department’s case against Fujian Jinhua is still pending. 

--With assistance from Peter Blumberg.

©2023 Bloomberg L.P.