SAN JOSE, Calif. - Applied Materials Inc. has entered into a settlement agreement with Samsung Electronics Co. Ltd. over alleged misuse of trade secrets.
Earlier this year, prosecutors in Seoul, South Korea, arrested executives from U.S. semiconductor equipment maker Applied (Santa Clara, Calif.) alleging they stole Samsung process technology details and passed them on to Hynix. The information stolen included manufacturing process technology details for DRAMs and NAND flash memory as well as investment plans for chip production, which were passed on to Hynix Semiconductor Inc.
Applied and Samsung settled the case. The agreement resolves potential civil claims and removes the risk of civil litigation between the parties relating to the alleged acquisition, misappropriation and misuse of Samsung confidential semiconductor information in Korea.
''Under the agreement, which is generally effective for a three-year period starting November 1, 2010, Applied will provide volume-based rebates on purchases of semiconductor products by Samsung and its affiliated companies,'' according to Applied.
''Applied also will provide volume-based incentives related to Samsung’s use of Applied systems (i) for production of semiconductor devices in applications for which Samsung has not previously used Applied systems, and (ii) for joint development activities,'' according to the fab tool firm.''In addition, the agreement includes volume-based credits for certain upgrades, engineering services and spare parts.''
The financial impact of the above rebates and incentives on Applied’s consolidated results of operations and financial position will depend on the volume of purchases by Samsung after the effective date of the Agreement. In fiscal 2009, Samsung accounted for approximately 10 percent of Applied’s consolidated net sales.
Applied currently expects that operating margins for its Silicon Systems Group will be consistent with its previously-released segment financial model, with downside risk of no more than one percentage point below the low end of the range.