Micron (Crucial) temporarily banned from sales and production in China

Just as NAND and DRAM prices go down, Micron loses a lawsuit in China and needs to stop the sales and production of DRAM, NAND and products that make use it. The decision only applies to the region of China, but they have production facilities there, it might impact the rest of the globe. 

In a patent ruling in favor of UMC, the Fuzhou Intermediate People’s Court of the People’s Republic of China issued a preliminary injunction stopping Micron from selling 26 products, including dynamic random access memory and Nand flash memory-related products, UMC said in a statement Tuesday. Micron said it hasn’t been served with the injunction and won’t comment until it does. Shares in the Boise, Idaho-based company dropped as much as 8 percent, reports bloomberg.

UMC took legal action against Micron in January, alleging that the U.S. company infringed on patents in China related to memory storage and other products. Among the remedies it sought was to stop Micron from making, importing or selling the allegedly infringing products and also destroy all inventory and pay compensation. UMC declined to provide a copy of the court’s decision. An official who answered a call to the court’s news office confirmed the existence of an injunction order on Micron, but said details of the ban would not be made public because the case is still ongoing.

Micron facility in Xi'an, responsible for ICs, has to shut down its work.

The case is part of a broader dispute between the two companies centering on accusations that UMC acted as a conduit for the theft of Micron’s designs in an attempt to help China grow its domestic chip industry and replace imports that rival oil in total value. A Chinese antitrust regulator is already investigating Micron and its Korean rivals, the companies have said. Local media has reported that authorities are looking into increases in chip prices. Last year, Micron sued UMC and its partner Fujian Jinhua Integrated Circuit Co., claiming they stole memory chip trade secrets. China accounted for more than 50 percent of Micron’s revenue in fiscal 2017, according to company data. It is a provisional ban, however, the judgment issued on July 3^rd not only banned the sales of some Micron-branded and Crucial-branded products in China, but also ordered Micron’s IC assembly/testing plant in Xi’an to halt operation; Micron Technology (Shanghai) Co., Ltd. has also been ordered to cease sales. The judgment will have significant impacts on the sales of products under Micron's own brand or the Crucial brand in China. Moreover, the businesses of Micron's downstream partners would also be affected.

Micron can still appeal. The Taiwanese competitor UMC publishes the news in a press release