Gigastorage reaches initial settlement with Philips on CD-R, CD-RW patent dispute

Gigastorage, aTaiwanese CD/DVD recordable manufacturer has announced it that it has reached a preliminary settlement with Royal Philips Electronics regarding litigation on infringement of CD-R and CD-RW patents. Gigastorage should compensate Philips in the settlement, but declined to reveal the amount due to a non-disclosure agreement with Philips, the company indicated.

According to sources of Digitimes in Taiwan, Gigastorage stopped paying royalty fees to Philips in April 2001.  Philips then filed a charge in the US. After a long process of litigation Philips finally won the suit as judged by the US International Trade Commission in February 2007, the sources pointed.

For the settlement, Philips demands that the compensation, based on all of Gigastorage’s shipments of CD-R and CR-RW discs, and be paid in 10 years, but Gigastorage thinks only shipments to the US market are subject to the compensation and payment should be in installment over 10 years, the sources pointed out.  Also it is unsure if Gigastorage will accept Veeza, which is Philips’ new CD-R licensing system, in the final settlement.