Dickinson Wright is pleased to announce that it has obtained a substantially favorable settlement for SinCo Technologies Pte Ltd., which resolves the multiple Federal litigation, California litigation, PRC litigation, and USPTO proceedings after over five years of litigation. The Federal trial ended in a jury award of $14.5 million judgment for trademark infringement back in November 2021. The California action was set for Jury trial earlier this year in Superior Court of California on claims of Misappropriation of Trade Secrets, Breach of Contract and Civil Conspiracy before the honorable Judge Sunil Kulkarni. The final settlement to these disputes came a week before trial was set to proceed.
"We are pleased with the outcome of the settlement proceedings on behalf of our client, SinCo Technologies Pte Ltd., and we are grateful that the jury unanimously and clearly understood our assertion that initial interest confusion occurred with the trademarks. The litigation demonstrate the need for companies to be vigilant about protecting their brands and trade secrets within the U.S. marketplace," says Lael Andara, Lead Counsel and Member in Dickinson Wright's Silicon Valley office.
SinCo Technologies Pte Ltd., represented by its co-owner and Chief Operating Officer, Dr. Jonathan Chee, convinced jurors last November in Federal Court that China's Xingke Electronics Co. Ltd. used the SinCo name in violation of three U.S. trademarks resulting in millions of damages to SinCo's business and goodwill. The jury also found willful trademark infringement by Mui Lian Tjoa, issuing $2 million in statutory damages, and SinCo's ex-employees, Mark Liew and Cy Ng, issuing $750,000 each in statutory damages. Mark Liew and Cy Ng had traveled to the U.S. and used the SinCo trademarks while still employed by the company. The jury returned the verdict after three days of deliberation in the Northern District of California with Judge Edward Chen presiding over the case.
In a separate case that was set to go to trial in February, SinCo Technologies Pte. Ltd. claimed the Defendants committed breach of contract, civil conspiracy and misappropriation of trade secrets. The anticipated three-week trial before Judge Sunil Kulkarni was originally filed back in October 2016. The final settlement negotiations were conducted days before the trial and resulted in a tentative settlement, approved on April 15, 2022 by SinCo Technologies Pte Ltd., led by Dr. Chee and the defendant companies' shareholders.
Defendants' parent company, Jinlong Machinery & Electronics Co., Ltd., ("Jinlong") have publically acknowledged in a May 23, 2022, letter from their Certified Public Accountants to the Shenzhen Stock Exchange that, "Based on a comprehensive assessment of the attorneys acting in these actions, the risks that Xingke DG would be exposed to, expressed in monetary terms, added up to USD38,000,000~USD64,000,000." Furthermore, Board of Directors of Jinlong also sent a letter to the Shenzhen Stock Exchange on May 23, 2022 acknowledging that:
The Company may pay the second installment with the payments received from the sale of Huaibei Jinlong Co. (one of Jinlong's subsidiaries)'s facilities and land, and the cash balance generated by the business operation.
The Company may pay the third installment with the payments received from the sale of Huaibei Jinlong Co. (one of Jinlong's subsidiaries)'s facilities and land, and the cash balance generated by the business operation.
The parties agree to extend the release to any suits relating to the abuse of any business secrets or confidential information of any kind as between the parties after the effective date of the agreement.
The case dealt with the unique challenges that the COVID-19 pandemic presented to many litigation matters that are moving through U.S. courts at this time as well as dealing with the fact that none of the parties to this matter were from the United States. According to Mr. Andara, the substantial verdict and related settlement for SinCo Technologies confirm that U.S. courts and their laws provide substantial legal protections for foreign companies doing business in the United States. "Globalization has made U.S. markets desirable and accessible to non-U.S. providers of goods and services, exposing them to U.S. litigation as never before. As the case at hand so aptly demonstrates, effective representation ensures that an infringing party does not benefit from another's established and hard-earned reputation and intellectual property," says Andara.
SinCo Technologies was represented by Lead Counsel Lael Andara (Silicon Valley) and the team included Manali Shah (Silicon Valley), Steven Daniels (Austin), Kristen Hudson (Chicago), Frank Smith (Troy) and Sharae' Williams (Ann Arbor). In the jury trial, the Defendants were represented by the firm of Arnold & Porter.