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Judge rules against Canon, Inc., Nano-Proprietary has option to terminate SED agreement

The legal battle between Canon, Inc. and Nano-Proprietary, may have reached an end on Thursday.  A U.S. court ruled against Japan's Canon, Inc. in the licensing dispute over Nano-Proprietary's surface-conduction electron-emitter displays.

Nano-Proprietary now has the right to terminate its license agreement with Canon it had made in 1999, according to the ruling by Judge Samuel Sparks of the U.S. District Court for the Western District of Texas.

The licensing dispute was triggered when Canon licensed its agreement on the technology with Toshiba Corp. for manufacturing.  The venture was then deemed an infringement on the agreement between Canon and Nano-Proprietary.  Nano-Proprietary claimed that the licensing deal did not extend to Toshiba Corp.

Before the legal battle panned out, Canon announced it would buy out all of Toshiba's shares in the joint venture, Nano-Proprietary stuck to its guns, stating that the decision would not change the company's stance in the litigation. 

"Canon's recent restructuring of SED as a wholly owned subsidiary is ineffective to prevent termination because this effort to cure the breach was not undertaken within a reasonable time.  It occurred more than a year and a half after Canon was on notice of its breach." commented Judge Sparks on Canon's move to prevent the termination of the agreement.

The production of the SED display was anticipated to boost Canon's revenue, with the company trying to get its foot in the door of the $84 billion flat-panel display market.  Because of its new presence in the scene, Canon had extended out its license to the SED technology in order to acquire more experienced flat-panel manufacturers

According to Reuters, the Tokyo-based company reassessed its plan to build a 180 billion Yen ($1.48 billion USD) factory in Western Japan for flat-panel mass production.  Even with the latest news in the lawsuit, Canon still aims to produce SED panels at a smaller site and wants to keep Japan availability for the fourth quarter of this year.

Nano-Proprietary stated last month in a press release that even though Canon had infringed on the license agreement, the Texas-based company would be willing to sign a new agreement post-litigation.



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It's about MONEY !!!!
By 13Gigatons on 2/26/2007 12:12:16 PM , Rating: 2
Canon began work on SED in 1986, in 1999 they paid Nano 5.6 million one time payment to use their IP. The only IP that Nanotech owns is the use of carbontubes for SED.

Canon realized they didn't have enough experience in TV production and formed a joint startup with Toshiba called SED, inc. In order to stay true to their deal with Nano, Canon would have one voting share more then Tosihba but agreed they would never use it agianst Tosihba. Canon thought they had outsmarted Nano.

Flash foward to the Texas judge who said, “Dead fish don’t swim, dead dogs don’t hunt and Canon’s dead voting rights don’t give it a majority of SED.” So that means that Canon and Tosihba are equal partners which means the deal with Nano is in breech.

So now if Canon wants to launch SED in the USA or elsewhere in the world that Nanotech has the IP recognized they will have to pay Nanotech more money plus royalties.

If only Canon and Tosihba had set up the joint venture properly they would be in beginning to build the huge 1.7 billion fab needed to produce millions of SED TV's.




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