China’s Suzhou Intermediate People’s Court of Jiangsu province on July 11 will hear a lawsuit filed by Chinese silver paste manufacturer Jiangsu Suote Electronic Materials Co., Ltd. (江苏索特电子材料有限公司) against domestic rival Changzhou Fusion New Material Co., Ltd. (常州聚和新材料股份有限公司), alleging patent infringement of Chinese Patent No. 201180032359.1 and Chinese Patent No. 201180032701.8 and seeking 200 million yuan ($30 million) in damages and costs. The two patents are both directed to thick-film pastes containing lead—tellurium—lithium—titanium—oxides, and their use in the manufacture of semiconductor devices.

Taizhou city, Jiangsu province-based Suote was founded in 2020. The company in February 2021 acquired the Solamet photovoltaic (PV) metallization paste business from the Microcircuit and Component Materials (MCM) unit of one of the world’s largest chemical companies DuPont de Nemours, Inc. for $190 million. The PV metallization paste, also known as silver paste, is designed for rotary screen printing to enable high speed roll to roll processing of thin and flexible solar cells and modules. The paste is key to higher efficiency and lower system costs for both crystalline silicon (c-Si) and thin film PV. Suote in February 2021 incorporated Solar Paste, LLC in Delaware to conduct the acquisition, of which the assignment of the two asserted patents in the lawsuit was part.

Changzhou city, Jiangsu-province Fusion was founded in 2015. Fusion has been ranked among the top sliver paste manufacturers in Chinese markets, where the long-time dominance of manufacturers such as Germany’s Heraeus, U.S.’s DuPont, and South Korea’s Samsung have been eroded by indigenous makers. Fusion in late 2020 acquired the silver paste business of Samsung SDI Co., Ltd., the battery and electronic materials unit of the Samsung Group, for $8 million. The assignment of 285 Samsung SDI’s invention patents was part of the deal. Fusion in June 2021 acquired Japanese company Shoei Chemical, Inc.’s 51% share of the rights to 23 patents jointly owned by it and Heraeus for $4 million.

Fusion in June 2021 filed an application for an initial public offering (IPO) at the Shanghai Stock Exchange STAR Market, equivalent to the U.S.’s Nasdaq. The application shows Fusion’s current patent portfolio includes 297 invention patents and 9 utility model patents. The application is still under review by the Listing Committee of the Shanghai Stock Exchange (SSE), which in June raised some questions about the litigation involving Fusion.

What is behind the litigation is Fusion’s strong competitor Wuxi city, Jiangsu province-based Wuxi DK Electronic Materials Co., Ltd. (无锡帝科电子材料科技有限公司). Another top-ranking domestic silver paste manufacturer, DK was founded in 2010 and preempted Fusion by becoming listed on the SSE in 2020, despite lagging behind Fusion in revenue. Fusion’s 2021 IPO application as a catch-up move on the capital market evidently rattled DK’s nerves. DK in July 2021 announced its plan to acquire Suote for $190 million and had Suote as its prospective subsidiary launch the legal battle against Fusion in both China and the U.S. thereafter.

Suote in August 2021 sued Fusion in the Suzhou Intermediate People’s Court for manufacturing and distributing a series of silver pastes for silicon solar cells front side metallization infringing its two patents. Meanwhile, Suote also filed eight petitions before the Patent Reexamination and Invalidation Department (PRID) of the China National Intellectual Property Administration (CNIPA) to invalidate Fusion’s eight patents Chinese Patent No. 201511016300.X, Chinese Patent No. 201610545278.6, Chinese Patent No. 201610595817.7, Chinese Patent No. 201810765213.1, Chinese Patent No. 201811139986.5, Chinese Patent No. 201910424419.2, Chinese Patent No. 201710994586.1, and Chinese Patent No. 201610476199.4. The PRID ruled Patent Nos.’986, ’278, ’300, and ’817 to be partially valid and Patent ’199 to be wholly valid as of June. Unlike the acquired bulk of its patent portfolio, these challenged patents cover technologies of which Fusion was the original inventor.

Solar Paste, LLC, Suote’s subsidiary, in September 2021 sued Fusion in the United States District Court for the District of Delaware for infringement of U.S. Patent No. 7,767,254, U.S. Patent No. 8,497,420, U.S. Patent No. 8,889,979, U.S. Patent No. 8,889,980, and U.S. Patent No. 8,895,843. U.S. Patent Nos. ’420 and ’843 both cover thick-film pastes containing lead- and tellurium-oxides, and their use in the manufacture of semiconductor devices. Patent No. ’254 covers a paste for solar cell electrode and solar cell. U.S. Patent Nos. ’979 and ’980 both cover thick-film pastes containing lead—tellurium—lithium—titanium—oxides, and their use in the manufacture of semiconductor devices. Suote had acquired all these asserted patents from DuPont.

In its response to the questions of the Listing Committee of the SSE, Fusion said according to a patent licensing agreement reached in November 2019 by Samsung SDI and DuPont Specialty Products USA, LLC and DuPont Electronics, Inc., two DuPont’s subsidiaries, whose assets, tangible and intangible, relating to silver paste were acquired by Fusion and Suote respectively, Samsung SDI and DuPont agreed to license these patents, as part of the assets, to each other and not to assert these patents against each other. Premised on this, Fusion indicated that Fusion, as an assignee of this licensing agreement, should be exempt from litigation over any of the patents under this agreement.

The case docket no. is （2021）苏05民初1826号, whose English translation is 1826, first instance (初), civil case (民), (2021) Suzhou Intermediate People Court of Jiangsu Province (（2021）苏05).

中文新闻线索：

https://mp.weixin.qq.com/s/5NkAOLm_PzLxTilyoq7eTQ

https://mp.weixin.qq.com/s/xArRLgiqXDV5Pgym7DYRzQ

https://m.chinaipo.com/news/867457.html

http://www.iprdaily.cn/article_31545.html

https://www.ccieurolam.com/en/products/next-gen-photovoltaics/

https://www.photonicsonline.com/doc/dupont-solamet-pv414-photovoltaic-0001

https://m.21jingji.com/article/20220322/06e8e1bcd8c11769f76b88839253d42b_zaker.html

https://www.pv-tech.cn/news/TECO_Swilly_on_the_acquisition_of_solamet

https://pdf.dfcfw.com/pdf/H3_AP202205051563621762_1.pdf?1651744790000.pdf