Toshiba's response follows a jury verdict in a lawsuit brought by Lexar (Frement, Calif.) in California Superior Court in San Jose. The jury found Toshiba and its U.S. subsidiary, Toshiba America Electronics Components Inc. (TAEC), liable for the penalties in connection with the alleged misappropriation of NAND flash trade secrets.

"Toshiba believes that the verdict rendered by the jury was in error, and we plan to pursue all available legal avenues to correct it," the company said in a statement. "Toshiba invented NAND flash memory technologies and has been a pioneer throughout its development."

Toshiba's stock price dropped 2 percent Friday from the previous day's close.

NAND flash is one of mainstays of Toshiba's chip business. It completed a 300-mm wafer fab last February at its Yokkaichi plant to boost NAND flash production. "Toshiba will continue pursuing technologies that enable it to scale down flash memories and enable it to go ahead of competitors on the market," said Toshiba President Tadashi Okamura said at the fab opening.

To retain its position as a major NAND flash supplier, analysts here said Toshiba would wage an aggressive legal counter attack against Lexar.