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Western Digital Ordered to Pay $525 Million To Seagate

By - Source: Cnet | B 47 comments

A drop in the bucket Western Digital plans to fight on principle, if one can call it that.

The battle between hard driver makers Seagate and Western Digital over misappropriated company secrets has ended somewhat inconclusively on Friday, with arbiters ordering Western Digital to pay 525 million dollars to Seagate. The decision is the capstone to a rough year for Western Digital that included massive flooding in Thailand, where the company produces 60 percent of its drives. WD is thus far refusing to comply with the order, vowing instead to fight the decision in court.

"We do not believe there is any basis in law or fact for the damage award of the arbitrator. We believe the company acted properly at all times," president and CEO John Coyne said in a statement issued to the media, "and we will vigorously challenge the award."

The fight started in 2006, when Seagate moved to sue after a former employee hired by Western Digital allegedly shared "confidential information and trade secrets". The court case was postponed in 2007 when the two parties chose to enter arbitration. With Friday's decision, and Western Digital's vow to fight it, the battle that has already lasted five years is likely to intensify. Though the decision appears to be a stunning loss, Western Digital reported Q3 2011 earnings of nearly 4 billion dollars; their planned 4.3 billion dollar acquisition of Hitachi GST will go forward as planned. Western Digital and Seagate dominate the hard drive market, controlling a respective 32 percent and 31 percent.

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Top Comments
  • 36 Hide
    Anonymous , November 23, 2011 12:16 PM
    No one wants to steal Seagate's secrets anymore because their drives are shit
  • 34 Hide
    back_by_demand , November 23, 2011 12:32 PM
    $525 million should buy a lot of sandbags for the next time the factory gets flooded.
  • 22 Hide
    inerax , November 23, 2011 1:02 PM
    More reason to stick with WD.
Other Comments
  • 36 Hide
    Anonymous , November 23, 2011 12:16 PM
    No one wants to steal Seagate's secrets anymore because their drives are shit
  • 34 Hide
    back_by_demand , November 23, 2011 12:32 PM
    $525 million should buy a lot of sandbags for the next time the factory gets flooded.
  • 22 Hide
    inerax , November 23, 2011 1:02 PM
    More reason to stick with WD.
  • 16 Hide
    nikorr , November 23, 2011 1:05 PM
    WD rulez...
  • 20 Hide
    nikorr , November 23, 2011 1:06 PM
    Seagate is not bad, and without them prices would be a lot higher : )
  • 3 Hide
    TheWhiteRose000 , November 23, 2011 1:08 PM
    Wait so that explains why I can't ever find the Hitachi terabyte I need for a raid 1.
    Huh, well I do feel kinda stupid cause I read about this previously I just never bothered to think about it.
    Upside though Hitachi going 4 years strong, so reliability of Hitachi with epicness of a Western Digital?
  • 10 Hide
    jdamon113 , November 23, 2011 1:12 PM
    Seagate is desporate becasue there drives suck. WD had never failed me.
  • 15 Hide
    digiex , November 23, 2011 1:20 PM
    $525 million will be enough to relocate its factories to the Philippines.
  • -4 Hide
    turboedge , November 23, 2011 1:29 PM
    Great, by the time the Hitachi 1tb per platter drives are affordable, WDC will have eliminated them from the product line.
  • 4 Hide
    N.Broekhuijsen , November 23, 2011 1:33 PM
    Seagate.... Sea... Gate....

    ok lame.

    anyways screw seagate, WD all the way!!
  • -1 Hide
    r0aringdrag0n , November 23, 2011 1:33 PM
    "LET'S SUE WESTERN DIGITAL, We got nothing better to do anyways, not like there is a flood that we can focus recuperating from..."
  • 7 Hide
    zanny , November 23, 2011 1:34 PM
    I am a WD fanboy, but having friends with Seagate drives they work fine too if you get a top end one. Its called competition, if either of them got crappy the other would start trampling them.

    This is just another example of broken patents / copyright leading to lawyer trolling rather than innovation, like half the other news stories in the tech world.
  • 9 Hide
    soo-nah-mee , November 23, 2011 1:37 PM
    Go WD!!!
    ...and BTW, you guys need to ramp up your SSD line.
  • 1 Hide
    sonofliberty08 , November 23, 2011 1:58 PM
    screw wd ! leave the hitachi alone
  • 7 Hide
    Anonymous , November 23, 2011 2:19 PM
    @Zanny

    great reading between the lines there, want to point to me again where it says seagate sued WD over patent infringement, this is misappropriation of trade secrets, it's the same class of crime as corporate/industrial espionage, remind me again how that relates to patents.....
  • 5 Hide
    Skippy27 , November 23, 2011 3:09 PM
    From someone that has done computer support for more than 2 decades on desktop, servers and mainly laptops I can say without a doubt I would take and recommend a Seagate over a WD any day of the week. Especially when it comes to laptops.
  • 14 Hide
    amabhy , November 23, 2011 3:30 PM
    sonofliberty08screw wd ! leave the hitachi alone


    Not sure if trolling or just retarded.
  • 3 Hide
    soo-nah-mee , November 23, 2011 3:30 PM
    Skippy27From someone that has done computer support for more than 2 decades on desktop, servers and mainly laptops I can say without a doubt I would take and recommend a Seagate over a WD any day of the week. Especially when it comes to laptops.
    It's the "2 decades" part that probably instills that opinion in you. Seagate USED to be the top dog. Their quality has gone downhill in my experience. WD Scorpio Black for laptops IMO; without a second thought.
  • 2 Hide
    Benihana , November 23, 2011 4:19 PM
    Lol at the top two comments! :D 
  • 2 Hide
    drapacioli , November 23, 2011 4:30 PM
    soo-nah-meeIt's the "2 decades" part that probably instills that opinion in you. Seagate USED to be the top dog. Their quality has gone downhill in my experience. WD Scorpio Black for laptops IMO; without a second thought.


    I can second this. I have a laptop that is 2 years old and went through 2 Seagate Hard Drives, one regular and one performance (7200rpm), and they both died within 6 months. I bought a WD last year and have had no problems as of yet. I also have a WD from my desktop that has lasted 6 years. That desktop also has a Hitachi external drive which is going strong on 3 years, and a Seagate which has been replaced by other Seagate drives 3 times in the last 5 years. However, I still have two Seagate drives from my original Mac Pro G4, 9 years old, and while they have not been under heavy use like the others, the drive is still running strong. Clearly in the past Seagate made good drives, but obviously Seagate needs better quality control today. One consumer should not have to go through 5 drives in 5 years while other brand drives last considerably longer. However this article is on trade secrets, and if WD is guilty, then they deserve to pay the fines. Being a fan one way or another should not influence a court decision like this.

    P.S. I have also owned 2 Maxtors, one died the other is still kicking after 7 years, I tend to keep my hard drives until they break. My primary desktop has 4 internal 1 external (varying sizes from 40GB for a system backup to 1TB for my music and videos) and my laptop has 1 internal and 2 externals since they are all around 250GB, which is not enough for me on the go. I have a small collection going, and Seagate recently has dropped the ball on quality control. I do plenty of video editing so my drives do get a lot of heavy use and it tends to test the quality of them. Own no SSD's as of yet but looking this Black Friday for a good deal on an Intel 5 Series
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