Indonesia – Intel Vs VLSI Technology.

Intel is a multinational company founded in 1968, headquartered in the United States and renowned for the design and production of microprocessors and specializing in integrated circuits.

VLSI Technology LLC. was founded in 2016 by Softbank Group Corp’s Fortress Investment Group. This company was used to acquire several technology companies, including their patents, including Freescale Semiconductor Inc. and SigmaTel Inc. This company has a patent on a product that can power and speed up a processor, which is then allegedly used in Intel processors.

VLSI later sued Intel, claiming that the nearly 1 billion microchips sold by Intel violated VLSI’s existing patents. Unmitigated, 3 trials with fantastic lawsuit values ​​are also scheduled for VLSI VS Intel: March, April, and June 2021.

At the first trial, the jury agreed, awarding a $2.18 billion dollar verdict for Intel, at roughly $2 per chip (on chips likely to sell for $200 or less per chip based on third-party estimates). This ruling is the second largest patent fine ever in American history. Intel asked for one month to provide a rebuttal.

One month later, at a second trial, Intel escaped a VLSI lawsuit seeking $3.1 billion. Because Intel’s lawyers managed to convince that the processors they make are purely the creation of Intel scientists who have worked for decades.

A third trial between Intel and VLSI scheduled for June, with a $2 billion lawsuit being pushed back to December. What will happen to Intel in the third trial?

Patent Infringement in Indonesia

In Indonesia, patents are regulated in Law no. 13 of 2016 concerning Patents (Patent Law). According to Article 1 point 1 of the Patent Law, it explains that a patent is an exclusive right granted by the state to an inventor for his invention in the field of technology for a certain period of time to carry out the invention himself or to give approval to other parties to implement it. Patent Protection is divided into two, namely Patents and Simple Patents.

Sanctions on patent violators in Indonesia are regulated in Articles 161-166 of the Patent Law as follows:

Article 161

Any person who intentionally and without rights commits an act as referred to in Article 160 for a Patent, shall be sentenced to a maximum imprisonment of 4 (four) years and/or a maximum fine of Rp. 1,000,000,000.00 (one billion rupiah).

Article 162

Any person who intentionally and without rights commits the act as referred to in Article 160 for a simple Patent, shall be sentenced to a maximum imprisonment of 2 (two) years and/or a maximum fine of Rp. 500,000,000.00 (five hundred million rupiah).

Article 163

1. Any person who violates the provisions as referred to in Article 161 and/or Article 162, which results in health and/or environmental problems, shall be punished with imprisonment for a maximum of 7 (seven) years and/or a fine of a maximum of Rp. 2,000,000,000.00 (two billion rupiah).
2. Any person who violates the provisions as referred to in Article 161 and/or Article 162, resulting in human death, shall be sentenced to a maximum imprisonment of 10 (ten) years and/or a maximum fine of Rp. 3,500,000,000.00 (three billion five hundred million rupiah).

Article 164

Any person who intentionally and without rights leaks a confidential Application document as referred to in Article 45 paragraph (1) shall be sentenced to a maximum imprisonment of 2 (two) years.

Article 165

The crime as referred to in Article 161, Article 162, and Article 164 is a complaint offense.

Article 166

In the event that a Patent infringement is proven, the judge may order that the goods resulting from the infringement of the Patent are confiscated by the state for destruction.

6 The article refers to 1 Article that cannot be done according to the Patent Law, namely Article 160:

Any Person without the approval of the Patent Holder is prohibited from:

1. in the case of a product-Patent: making, using, selling, importing, renting, delivering, or providing for sale or rental or delivery of the product for which the Patent is granted; and/or
2. in the case of process-Patent: using a production process that is granted a Patent to manufacture goods or other actions as referred to in letter a.

Therefore, parties who can obtain a Patent on their invention must be able to have a novelty, inventive step, and can be applied in industry, as well as a Simple Patent which must have an element of development from a previously existing invention.

Source:

1. Law No. 13 of 2016 concerning Patents
2. https://www.jdsupra.com/legalnews/patent-litigation-update-july-2021-7648587/
3. https://www.lexology.com/library/detail.aspx?g=b38d8c8f-7bb3-466d-adeb-c3a62262de7f
4. https://www.scmp.com/tech/big-tech/article/3130606/semiconductor-giant-intel-wins-patent-infringement-trial-over-chips