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Micron lawsuit claims Chinese memory maker YMTC poached its engineers, then sued it using its own stolen tech
Some of YMTC's patents can actually belong to Micron, the company alleges.
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Micron this month filed a lawsuit against China's 3D NAND champion YMTC, accusing it of poaching its leading engineers, illegally obtaining its NAND memory know-how from them, and then using that information to build its own non-volatile memory as well as its patent portfolio. The Boise, Idaho-based company further alleges that YMTC uses patents granted to its former employees to accuse Micron of patent infringements in various jurisdictions.
To assemble a comprehensive IP portfolio that would cover everything from essential technologies to sophisticated manufacturing methods quickly, as well as to ensure that its patents overlapped with those of other 3D NAND manufacturers to enable it to attack Micron, the firm asserts YMTC opted for a rather simple, yet effective strategy: It poached engineers from Micron, then made them patent either standard essential inventions or inventions that closely resembled those they worked on while at Micron.To leave Micron without being asked questions, its former employees cited a broad range of personal or family reasons for their resignations and even did not update their LinkedIn profiles to reflect their new roles at YMTC. These employees had confidentiality obligations that continued after termination of their employment and proscribed them from using, disclosing, or possessing Micron’s confidential information. Meanwhile, Micron did not really investigate the whereabouts of its former employees and "had no reason to suspect YMTC itself" of planning to use its confidential information because "YMTC did not have any material market share in the industry.”
We are all used to cut-throat competition on the memory market as leading producers of DRAM and NAND try to win market share from each other and maintain profitability at the same time. These companies have broad cross-licensing agreements to neutralize direct patent wars that can result in devastating injunctions that could paralyze fab operations and eventually lead to assured mutual destruction. However, this does not seem to be the case for emerging competitors from China, ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Co. (YMTC), both established in 2016, which are increasingly attacking Micron in various courts, perhaps making pre-emptive strikes to avoid the destiny of their Chinese counterpart, Fujian Jinhua.
In its lawsuit against YMTC, Micron asserts that Yangtze Memory's patent campaign against Micron largely relies on patents that were granted to former Micron employees. Furthermore, Micron alleges that former employees brought its 3D NAND know-how to YMTC and subsequently developed patents covering related or overlapping technologies, which essentially means that Yangtze Memory has built its patent portfolio using Micron's intellectual property, which is why Micron claims that YMTC patents belong to Micron and therefore cannot be used against it.
"For example, these individuals include Daesik Song, Wenxi Zhou, and Hua Tan," Micron's lawsuit reads. "Each of these employees owed Micron contractual obligations to keep trade secrets confidential, had access to certain of the Micron Trade Secrets further described below while employed at Micron, and on information and belief, each joined YMTC shortly after leaving Micron. Each of these employees also regularly accessed one or more of the Trade Secrets that were located on servers in Boise by accessing Micron's highly confidential technical materials relating to its test and/or production nodes."
Micron's allegations in the new complaint go well beyond simple claims that its former employees brought manufacturing expertise to YMTC, something that happens often. The company alleges that YMTC systematically obtained confidential 3D NAND and memory technology from former Micron engi