Applied Materials sued in China by rival over alleged trade secret theft – report

American chip equipment maker Applied Materials was sued by rival Beijing E-Town Semiconductor Technology in China over what the Chinese company alleged as trade secret theft, Bloomberg News reported.

Beijing E-Town filed the lawsuit with the Beijing Intellectual Property Court against Applied Materials, as per a statement to the Shanghai Stock Exchange, the report added.

The Chinese company alleged that Applied Materials illegally obtained, used, and revealed its core technologies related to the application of plasma source in treating the surface of wafers, the report noted.

The court has filed the case but has not started a trial, Beijing E-Town added, as per the report.

Applied Materials did not immediately respond to a request for comment from Seeking Alpha.

Applied Materials earlier hired two staff from E-Town’s fully owned U.S. unit Mattson, and they were privy to the Chinese company’s proprietary plasma technologies, the report noted.

Applied Materials filed a patent application crediting the two people as inventors with the National Intellectual Property Administration in China after they joined the company, Beijing E-Town noted, alleging that the content disclosed trade secrets co-owned by E-Town and Mattson, according to the report.

“The patent application violated the rules of China’s Anti-Unfair Competition Law, and it infringes on trade secrets, and has caused significant damage to the plaintiff’s intellectual property and economic interests,” Beijing E-Town noted in the filing, adding that Applied Materials is also suspected of marketing and selling the technologies involved in the case to Chinese customers, the report added.

Beijing E-Town is requesting the court to demand that Applied Materials stop using the trade secrets and destroy the related materials. The Chinese company is also seeking about 100M yuan (around $13.9M) in recompense for damage, as per the report.

Applied Materials and Mattson have previously been in a dispute. In 2022, Applied Materials sued Mattson over alleged corporate espionage. Mattson had denied any wrongdoing at the time, the report added.