CMC Magnetics, Ritek, Prodisc Technology and Daxon Technology, four major Taiwan-based producers of blank CD-R discs, are poised to jointly file legal proceedings in Taiwan to accuse Royal Philips Electronics of imposing its unreasonable and discriminating Veeza licensing program upon them.
The four companies' key argument in the lawsuit is that Veeza's high royalty charge rates have severely limited the companies' ability to operate in the market for blank CD-R discs and that the licensing system discriminates against them because Philips has been unable to subject India-based maker Moser Baer India (MBI) and fellow makers in China to Veeza, TISA secretary general Tzuang-ren Jeng pointed out.
The result is that the four companies are unable to compete with MBI and Chinese makers in most fast growing markets in the Third World and the four companies are very concerned about this, Jeng indicated.
The four companies, along with the legal charge, will ask Philips to return paid royalty fees in excess of reasonable amounts and duly compensate for their lost business due to the discrimination of Veeza licensing, TISA indicated.
Philips Taiwan declined to comment, except to note that it has not received the legal document concerned.
According to industry sources, the four companies actually intend the lawsuit to pressure Philips into negotiation of a favorable adjustment in the Veeza licensing.
Story source:
digitimes.com.
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