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China Closes the Door on Micron

When there is war, there will always be casualties, and Micron Technology is the latest U.S. company to get caught in the middle of the United States' trade war with China.

Micron confirmed yesterday that a court in China has issued a preliminary junction that prevents the company's China subsidiaries from selling some of the chipmaker's products in the country. Chinese rivals United Microelectronics Corporation (UMC), which recently acquired Fujitsu's 300mm semiconductor fabrication plant, and Fujian Jinhua Integrated Circuit Co., Ltd. filed a lawsuit at the Fuzhou Intermediate People’s Court in Fujian province alleging that Micron had violated intellectual property rights. The ban seeks to prohibit Micron from selling 26 of its products, including Crucial and Ballistix-branded memory modules, solid-state drives, and memory chips used in graphics cards.

The Idaho-based chipmaker is convinced that UMC and Jinhua's lawsuit is nothing more than a revenge tactic to get back at Micron for the criminal and civil lawsuits filed by the Taiwanese authorities and Micron against UMC and three of its employees for the misappropriation of Micron trade secrets.

When word of the Chinese-imposed ban hit the news yesterday, Micron's shares fell 5.5% but rebounded to 1.9% at $52.46 in the afternoon. The chipmaker claims that the ban only impacts approximately 1% of its revenue this quarter. The chipmaker remains optimistic and expects to achieve its previously projected revenue within the range of $8-$8.4 billion.

"Micron is disappointed with the ruling by the Fuzhou Intermediate People's Court. We strongly believe that the patents are invalid and that Micron's products do not infringe the patents. The Fuzhou Court issued this preliminary ruling before allowing Micron an opportunity to present its defense," said Joel Poppen, senior vice president of legal affairs, general counsel and corporate secretary in a press release. "This ruling and other actions by the Fuzhou Court are inconsistent with providing a fair hearing through appropriate legal processes and procedures. Micron has a long-standing history of successful business operations in China, including a significant assembly and test manufacturing facility in Xi'an, as well as deep relationships with many valued China customers. Micron will continue to aggressively defend against these unfounded patent infringement claims while continuing to work closely with its customers and partners."

  • Non-Euclidean
    A Chinese court protecting Chinese IP thieves? Shocking, just shocking.
    Reply
  • bit_user
    I guess the key question is whether this could impact supply chains for graphics cards, SSDs, smartphones, etc. with so many of those now being made in China.
    Reply
  • 10tacle
    The sooner all these tech companies move production the hell out of China, the better. They are doing nothing but creating a bigger snake every year by staying there. Vietnam is a new and upcomer in manufacturing in the Asian region with affordable labor, so perhaps GPU AIB vendors, SSD makers, and the like that Bit references above can just move there, to Taiwan, Malaysia, South Korea, Philippines, etc. Even India could be an option. All have major ports for support of the largest container ships.

    Remember it was not that many years ago when hard drives were made in Malaysia and Taiwan. I still have many laying around as old backup data drives. Unfortunately, Japan has just gotten too expensive for most of the hardware tech companies to invest in new manufacturing facilities there. Never mind their earthquake prone region. The bottom line here is that China is now becoming the regional bully and throwing its weight around, and not just in the Pacific Rim region.

    They have already stated they plan on making inroads globally to compete against the US and EU nations in global manufacturing industry. By all means necessary including building military infrastructure to protect, and I quote General Secretary Xi Jinping, "their best interests abroad." We cannot continue to support a growing monster that shows no holding back on becoming more aggressive and belligerent to its neighbors. Especially Japan.
    Reply
  • dorsai
    "When there is war, there will always be casualties, and Micron Technology is the latest U.S. company to get caught in the middle of the United States' trade war with China."

    "The Idaho-based chipmaker is convinced that UMC and Jinhua's lawsuit is nothing more than a revenge tactic to get back at Micron for the criminal and civil lawsuits filed by the Taiwanese authorities and Micron against UMC and three of its employees for the misappropriation of Micron trade secrets."

    Which is it ? Issues resulting from a trade war or from a lawsuit ?

    Sounds like Liu is leading into the article by taking an unsubstantiated cheap shot at the President for doing whats right for America and addressing the ridiculous 507 billion dollar trade deficit with China...
    Reply
  • stevensen76
    As an American consumer, I'd be willing to pay a bit more for products built outside of China as they are becoming too belligerent to deal with on a business level. they obviously conveniently forgot, it's the American consumer that lifted many of them out of poverty. Yeah, they have a large population, but that population has had jobs thanks to the American consumer again. Take away those jobs, they go back to harvesting rice. It is what it is.
    Reply
  • bit_user
    21121349 said:
    Which is it ? Issues resulting from a trade war or from a lawsuit ?
    It sounds like the lawsuit was used as a pretext.
    Reply
  • bit_user
    21121395 said:
    that population has had jobs thanks to the American consumer again. Take away those jobs, they go back to harvesting rice. It is what it is.
    I'm sure the majority of their exports now go to markets other than the US. We'd have more clout if we could've stood together with our allies... before we slapped them all in the face.
    Reply
  • christianlaborscr
    It's almost as if we should be able to make our own computers.....

    Fiat currency is counterfeit currency. Ask yourselves what foreigners are buying with fake money they can only use in the USA, and yet we are at a constant trade deficit.

    It's called bribery.

    Trade deficit is the predictable effect of using OUR money as a global reserve. Triffin Dilemma. Nixon Shock.

    Trump is fixing the system, not breaking it. It's been broken for decades.
    Reply
  • Co BIY
    Trump didn't start the trade war. He just recognized it.

    https://www.nytimes.com/2018/06/22/technology/china-micron-chips-theft.html
    Tariffs are in general a bad policy that hurt those applying them as much as those targeted. But attacking China's IP theft, corporate espionage, cyber attacks and mercantilism is badly needed and too long in coming.
    Reply
  • alan_rave
    Bad news and thats just the beginning, I think.
    Reply