In a final decision signed by court arbitrator Hon. William G. Bassler, the United States Federal District Court in New Jersey ruled recently that PNY Technologies, Inc should pay 7.71 million U.S. Dollars in patent licensing fees and interests to the Shenzhen-based Netac Technology Company.

Netac Technology was founded in 1999, mainly engaging in the distribution of USB flash disks. In the same year of its founding, Netac developed the first USB flash disk in the world. In November 1999, the company filed a patent application named electronic external storage method and its device for data processing system, and it was granted in July 2002. In December 2004, the patents of the same group were granted in the U.S.

PNY Technologies was established in 1985 with its main products including memories, USB flash disks, flash disks, earphones, graphics cards. Over the years, PNY Technologies has been ranked the second in market share of flash disks in the U.S.

In February 2006, Netac filed a lawsuit against PNY in the United States Federal Court for the Eastern District of Texas on the ground that PNY had infringed its No.US6829672 invention patent and sought cease of infringement and damages. The dispute between the two sides was settled out of court before hearing. In February 2008, the settlement agreement between Netac Technology and PNY was concluded. According to the agreement, PNY was licensed to use a host of patents including No.US6829672 patent, and PNY should pay licensing fees to Netac.

Netac believed that PNY breached the agreement in the course of fulfillment and would bring arbitration proceedings to the said court in New Jersey. In November 2013, PNY filed for a declaratory judgment and argued that the matters fall outside the scope of arbitration, and should be tried by the court as a regular case. It also argued that certain products produced and distributed by PNY should be excluded from the agreement. In December 2015, the court ruled that the dispute matters were in the scope of arbitration.

In July 2017, Netac received a letter carrying the part of final arbitration decision from arbitrator Hon. William G.Bassler. On July 28 this year, Netac received a letter carrying the final arbitration decision from arbitrator Hon. William G. Bassler, ordering PNY to pay 7.71 million U.S. Dollars in patent licensing fees and interests to Netac, and making the Chinese tech firm's 12-year legal battle finally worthwhile.


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