Globalfoundries Sues TSMC; Seeks Import Ban on iPhone Parts

Globalfoundries sued larger rival TSMC for using its patented chip technology, according to Bloomberg. It has requested a U.S. trade agency impose import bans that could roil the market for crucial components of a huge swath of electronics, including the iPhone.

The U.S.-headquartered chipmaker, which like TSMC manufactures semiconductors for other companies, filed patent-infringement complaints at the U.S. International Trade Commission in Washington, as well as civil lawsuits at federal courts in the U.S. and Germany. The complaints cite TSMC and customers including Apple, Broadcom, Qualcomm, Xilinx, Nvidia and their device-maker customers including Cisco, Google and Lenovo.

The broad-ranging legal assault threatens to disrupt the supply of everything from smartphones to personal computers to vital infrastructure like switches and routers that are the backbone of the internet. It highlights the importance of TSMC as a supplier of the components that keep modern electronics running. It also comes at a time when the worldwide supply chain is being disrupted by a burgeoning trade dispute between China and the U.S.

TSMC spokeswoman Elizabeth Sun said her company hasn’t been served with any court papers and it isn’t familiar with the details of the suit. "TSMC has always respected intellectual property and we have developed all our technologies by ourselves," Sun said.

Globalfoundries, like other so-called contract chipmakers, has struggled to keep pace with TSMC whose factories are now rated the best in the industry. The U.S.-based company is seeking ‘substantial’ damages from its Taiwanese rival which it alleges is using Globalfoundries’ technology to help it win tens of billions of dollars of sales, it said in a statement.

The patents it’s asserting cover the fundamentals of how semiconductors are manufactured. Some are U.S. patents and others are European covering esoteric but important areas like “structures of and methods and tools for forming in-situ metallic/dialectric caps for interconnects.“ They involve the most advanced technique, called 7 nanometer, that TSMC is currently using.