Chinese firms to file patent lawsuit against Hitachi Metals

After one year's preparation, an alliance formed by seven Chinese neodymium iron boron magnet producers will move forward with the patent lawsuits in the US against Japanese Hitachi Metals Ltd, China Business News reported Monday.

The alliance will hand the related files to the United States Patent Office, trying to drop Hitachi Metals' several core patents, Zhao Hongliang, President of Ningbo Tongchuang Strong Magnet Material Co Ltd, member of the alliance told journalist of China Business News at the Sixth Baotou China Rare Earth Industry Forum.

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Neodymium iron boron, a popular rare earth product known for its magnetic property, is widely used in fields such as automobile, wind power and other high-technology industries.

Data provided by the alliance shows that Japanese Hitachi Metals Ltd holds more than 600 related patents around the world, and it has only authorized eight Chinese companies with 149 patents, which greatly limited the export of Chinese neodymium iron boron magnet producers.

As for the huge number of the patents, it plans to apply for the invalidation of several core patents Hitachi Metals holds in the US and then battles for the patent invalidation one by one.

Sun Baoyu, president of Shenyang General Magnetic Co Ltd, another member of the alliance, said that the seven enterprises can produce more than 10,000 tons of neodymium iron boron magnet products, but without the patents, the products cannot be sold to overseas high-end markets and that is really a big loss for the producers.

Without the patents, it was just a higher cost issue for enterprises, but it may stop the clients purchasing the products due to patent concerns, Jia Yingyan, sales manager of Hangzhou Permanent Magnet Group said. According to the report, prices of Chinese neodymium iron boron products are 10 to 30 percent lower than that of Hitachi Metals.

Besides the three companies above mentioned, members of the alliance also include Ningbo Permanent Magnetics Co Ltd, Ningbo Ketian Magnet Co Ltd, Ningbo Huahui Magnet Co Ltd and Jianmgen Magsource New Material Co Ltd.