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Republican lawmakers urge federal agency to block imports of infringing TSMC chips as patent ruling nears — five asserted U.S. patents come from United Microelectronics Corporation

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Republican lawmakers urge federal agency to block imports of infringing TSMC chips as patent ruling nears — five asserted U.S. patents come from United Microelectronics Corporation

Republican lawmakers urge federal agency to block imports of infringing TSMC chips as patent ruling nears — five asserted U.S. patents come from United Microelectronics Corporation

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By Luke James published

An initial determination in the case targeting TSMC's 7nm and smaller nodes is expected this month.

Four Republican members of Congress have urged the U.S. International Trade Commission to block imports of foreign-made chips found to infringe U.S. patents in a case centered on TSMC, according to a recent letter to ITC Chair Amy Karpel obtained by Axios. The investigation concerns chips fabricated on TSMC's 7nm and smaller process nodes, names Apple, Qualcomm, and Broadcom among the respondents, and an initial ruling is due this month. Representative Ryan Zinke (R-Mont.) and Senators Tim Sheehy (R-Mont.), Roger Marshall (R-Kan.), and Bernie Moreno (R-Ohio) argued in the letter that strategically important companies shouldn’t receive special treatment.

The ITC began investigation 337-TA-1443 in late March based on a complaint filed that February by Longitude Licensing and Marlin Semiconductor, two Dublin-registered subsidiaries of patent licensing firm IPValue Management, which San Francisco private equity firm Vector Capital has owned since 2014.

The five asserted U.S. patents came from United Microelectronics Corporation, TSMC's Taiwanese foundry rival, in 2021. The complainants seek a limited exclusion order and cease and desist orders covering non-x86 semiconductor devices made on TSMC's 7nm and smaller nodes, along with downstream products containing them, a scope that takes in the silicon behind current AI accelerators, smartphones, and PCs. The Federal Register notice lists TSMC, Apple, Broadcom, Qualcomm, Lenovo, Motorola, and OnePlus entities as respondents.

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TSMC confirmed in its latest annual report that a companion lawsuit in the Eastern District of Texas was stayed in April last year, pending the ITC's outcome, which the company said it can’t determine. An evidentiary hearing took place in February, and the full Commission decision is expected in October, according to Quinn Emanuel LLP, which is representing TSMC and Qualcomm in the investigation.

The Republicans’ letter answers an earlier push from Arizona Democrats, including Senators Ruben Gallego and Mark Kelly, along with Representative Greg Stanton, who warned the ITC that an order made against TSMC could disrupt semiconductor production, AI development, and defense systems. TSMC has committed roughly $165 billion to its Arizona manufacturing site, and North America was responsible for generating 75% of the company’s revenue last year.

The case is the most serious import-ban threat against TSMC silicon since GlobalFoundries sought to bar U.S. imports of TSMC-made Nvidia and Apple chips over node-related patents in August 2019. TSMC countersued, and both companies dropped all litigation within two months under a 10-year cross-license.

Longitude and Marlin manufacture nothing, so TSMC has no infringement counterclaims to trade, and a license fee is the complainants' ultimate goal. Any exclusion order the Commission issues in October would still face a 60-day presidential review before taking effect.

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Luke James
Luke James
Contributor

Luke James is a freelance writer and journalist.  Although his background is in legal, he has a personal interest in all things tech, especially hardware and microelectronics, and anything regulatory. 

6 Comments Comment from the forums
  • Zaranthos
    If the aim is to keep political discussions, or at least disputes out of the forums then I feel like at least the titles of articles could be more generic and just say US politicians which also makes more sense to your international readers.

    Blocking the imports seems pointless considering if they lose the case they'll probably just pay a huge fine or be forced to license the tech they allegedly stole.
    Reply
  • magbarn
    Sounds like the Patent Trolls have paid off the politicians again. It's obvious as these 4 are representing constituents that have zero skin in the game.
    Reply
  • Roland Of Gilead
    Zaranthos said:
    If the aim is to keep political discussions, or at least disputes out of the forums then I feel like at least the titles of articles could be more generic and just say US politicians which also makes more sense to your international readers.
    I've often thought that these particular types of articles, were almost incendiary, in how forum users might react to them. But recently, one of the mods made it very clear why these types of discussions get shut down.

    The forum rules existed long before the last 10 years of US or World politics did. The rules are simple. Keep politics out of it. The main reason? Well, that's obvious. There is always one or two who may not know the rules, or do know the rules and make inflammatory comments or get personal. This then garners further angry responses, which is not really healthy discussion. And then threads get shut down.

    As long as users comment only on the technical aspects of the articles, then that's cool and the gang! Then we (users) can enjoy the discourse and have opinion respected.

    When the articles are posted, they are not necessarily concerned with how forum users view the piece. However, the forum Mods, don't have control over the articles, but they do have to police them though here. I think they do a darn good job of that.

    Looking at the article though. This is nothing that hasn't been seen before. Patent wars have gone on for many years in the past, and will do in the future.
    Reply
  • bit_user
    The article said:
    argued in the letter that strategically important companies shouldn’t receive special treatment.
    Yes, but we also need to do a better job of solving the "patent troll" problem. That's making it more expensive US companies to do business and making products more expensive for US consumers.

    It's also stifling innovation - I can only wonder at how many startups were either killed off or never got funded, due to extortion by these firms (or concerns about such).
    Reply
  • bit_user
    Roland Of Gilead said:
    This is nothing that hasn't been seen before. Patent wars have gone on for many years in the past, and will do in the future.
    It's the scale and potential impact, which makes this notable. I think it'd probably be the biggest case of extortion by a patent troll we've ever seen, by far!
    I don't actually mind that, from a certain perspective. If it provides enough motivation to actually solve the patent troll problem, then it'd be worth the short-term pain. However, the political system is so broken right now that it'd probably just trigger a short-term "fix" and not touch the underlying problem.
    Reply
  • thestryker
    As much as it's notable that these lawmakers are all from a single party (to me it doesn't matter what party simply that any time this happens it deserves extra scrutiny) who the beneficiary is is a much bigger deal here. I appreciate the author of the article spelling it out so readers don't have to go look up the companies on their own:
    Longitude Licensing and Marlin Semiconductor, two Dublin-registered subsidiaries of patent licensing firm IPValue Management, which San Francisco private equity firm Vector Capital has owned since 2014.
    Once again we have a situation of a holding company that doesn't actually make anything shaking down companies. The ironic part in this case is that the company they got the patents from is still in business and assigned them to this company for the sole purpose of litigation. The rise of patent trolls has taken many shapes and this is a more recent one.
    Reply


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