Mitsubishi Heavy Industries, Ltd. and Mitsubishi Power Systems Americas, Inc. v. General Electric Company
On May 20, 2010, Mitsubishi Heavy Industries, Ltd. (“MHI”) and Mitsubishi Power Systems Americas, Inc. (“MPSA”) (collectively “Mitsubishi”) filed suit in the U.S. District Court for the Western District of Arkansas contending that General Electric Company (“GE”) is engaged in a scheme to monopolize the sale of variable speed wind turbines in the United States in violation of state and federal statutes. They seek a compensatory damages award in excess of $100 million, an award of treble damages, punitive damages, and a permanent injunction prohibiting further litigation by GE for infringement of specified patents that GE claims to own. Mitsubishi’s claims are brought pursuant to Section 2 of the Sherman Act, Section 43(a) of the Lanham Act, and a state law claim of tortious interference with contractual and prospective business relationships.
MPSA engages in the development, manufacture, and distribution of variable speed wind turbines and related components. It is a subsidiary of Mitsubishi Heavy Industries Americas, Inc. (“MHIA”), which itself is a wholly-owned subsidiary of co-plaintiff MHI. MHI is a Japanese corporation that designs, manufactures, and distributes variable speed wind turbines and related components. These plaintiffs allege that GE has engaged in a scheme to exclude Mitsubishi from the United States market for variable speed turbines and to intimidate other manufacturers, particularly foreign-based variable speed wind turbine makers. Mitsubishi alleges that GE’s scheme has four components: (1) attempts to pressure Mitsubishi into entering extremely costly and disadvantageous license agreements; (2) serial patent infringement litigation that Mitsubishi claims is a sham; (3) alleged fraudulent conduct by GE before the U.S. Patent and Trademark Office (“PTO”); and (4) a publicity campaign by GE that is interfering with Mitsubishi’s business relationships and that Mitsubishi alleges has created a false and misleading impression that Mitsubishi’s wind turbines infringed upon GE’s patents.
This dispute dates back to June 2005 when GE began sending notices to Mitsubishi claiming that GE had valid and enforceable patents upon which Mitsubishi infringed by its variable speed wind turbines. According to the complaint, Mitsubishi repeatedly denied these claims and asked GE for more information about the patents at issue.
In February 2008, GE filed a complaint at the U.S. International Trade Commission (“ITC”) against Mitsubishi alleging infringement of three patents. Then, in September 2009, GE filed a complaint in US District Court for the Southern District of Texas against Mitsubishi for patent infringement for the same three patents. In January 2010, the ITC terminated its investigation with a final determination of no violation by Mitsubishi, which also resolved the federal court litigation. In February 2010, GE filed a new complaint in the US District Court for the Northern District of Texas against Mitsubishi for patent infringement involving two other patents.
Mitsubishi claims that GE does not have valid patent claims but instead is using the litigation to keep Mitsubishi out of the United States market for variable speed wind turbines. It further claims that GE’s publicity campaign regarding the patent cases is intended to pressure Mitsubishi’s customers from engaging in business with Mitsubishi and that GE has hindered competition by intimidating others in the market into entering licensing agreements with GE. Mitsubishi refused to enter any such agreements with GE.
Mitsubishi has not sold a variable speed wind turbine in the United States since GE filed its complaint with the ITC in 2008. Before that time, Mitsubishi had sales of approximately $2 billion per year of variable speed turbines in the United States. Because Mitsubishi just recently filed its complaint, GE has not yet filed any response. Mitsubishi’s claims have implications for other competitors of GE as well as purchasers of these turbines. According to Mitsubishi, GE’s anticompetitive conduct has injured competition in the United States market for the sale of variable speed wind turbines and has deprived purchasers of these turbines of a free and competitive market for this product. In light of the long-term history of litigation between these parties, we expect GE will vigorously defend against Mitsubishi’s claims. We will monitor this case and post information about significant developments.