Samsung may join LG in NZ patent fight

Warehouse founder Stephen Tindall

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NEW ZEALAND screen and monitor technology company PureDepth is seeking an injunction to enforce its patents against the Asian giants of the television and monitor market, including Korean giant LG.

PureDepth, whose majority 52% owner is Warehouse founder Stephen Tindall's investment vehicle K1W1, is taking on a company called NCP Trading in the High Court at Auckland.

While NCP, a small local importer of Konka-branded televisions, is a relative minnow, LG has joined the proceedings and it is possible others, such as Samsung, will too.

That's because if PureDepth wins the case, the precedent could have global implications and affect a much broader range of television manufacturers, perhaps forcing them to license PureDepth's technology.

According to a judgement of the High Court at Auckland, PureDepth disassembled a Konka TV expecting to find componentry from a Taiwanese company CMO, with which it had previously tried to negotiate a licensing agreement. Instead it found componentry from LG which it also felt breached its patent. Another television contained similar componentry from Samsung.

According to affidavits filed with the court, LG intends to file a counterclaim for revocation of the patent concerned. It appears as if that counterclaim will be based on a claim of "prior art", or that the invention patented by PureDepth already existed, under a Japanese patent.

PureDepth says it holds an identical patent for the technology in the US, meaning a result in New Zealand could have much broader implications for television manufacturers and component makers.

"If this contention is true, and if PureDepth is successful in obtaining a finding of infringement of the New Zealand patent by way of the Konka television sets having LG backlighting display units, then such a judgement may well have considerable commercial ramifications in the US marketplace, being one of vastly greater size than that of New Zealand," Justice Fogarty writes in allowing LG to join the case and placing it on a fast track for further hearing.

PureDepth chief executive officer Andy Wood was not prepared to comment on the case.

The company, which holds 86 patents and has a further 64 pending according to Wood, is in the process of deregistering from the US OTC Bulletin Board, a subsidiary trading system of the Nasdaq high technology stock exchange.

Bleeding cash, it has slashed staff worldwide and refocused on two core markets: providing technology for Japan's massive Pachinko and Pachislot gaming market and a new mobile platform Wood was not prepared to discuss, apart from saying he was in discussions with several well-known companies to evaluate PureDepth's systems.

Wood says most of the remaining staff in Auckland are focused on research and development. The company has sufficient capital to continue operations through revenue from a licensing agreement with New York-listed International Game Technologies. It also licences to Sanyo.

PureDepth was founded in 1999 as Deep Video Imaging by Power Beat founder Peter Witehira and Gabriel Engel. Witehira was the inventor of a "never go flat" car battery. Witehira settled a long-running disagreement with Tindall in 2004, selling his stake in the Deep Video Imaging for $520,000.

Tindall's Warehouse does not sell Konka televisions. Dick Smith does.

- © Fairfax NZ News