Micron shares plummet after China bans chip sales

Micron shares plummet after China bans chip sales

Joel Poppen, Micron's general counsel, added that it "will continue to aggressively defend against these unfounded patent infringement claims while continuing to work closely with its customers and partners".

The Fuzhou Intermediate People's Court issued a preliminary sales injunction against Micron that prevents it from selling the chips, including DRAM chips and NAND flash memory chips, in China, UMC said in a statement late on Tuesday.

In response, UMC filed patent infringement lawsuits against Micron with the mainland China courts in January of 2018, covering three areas, including specific memory applications related to DDR4, SSD and memory used in graphics cards. It said the USA company's products infringed on three of its patents related to DDR4, SSDs, and graphic card memory.

Micron said it had not received the injunction and could not comment. 'UMC is pleased with today's decision, ' crows Jason Wang, co-president of UMC.

The lawsuit followed Micron's complaint in December against Chinese government-backed Fujian and UMC in a California court alleging misappropriation of its trade secrets and other misconduct. "And the stakes are high, as we can see in this case".

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"UMC's move to deepen ties with China and the eagerness to join the Chinese chip ecosystem could definitely help it leverage more resources and gain business interests from the nation when many emerging Chinese chip providers still need technical support from Taiwan", said Liu. If the judgment is enforced in the future, Micron will be prohibited from selling some of its memory products in China.

As of 11:42 a.m., shares of UMC had gained 0.56 percent to NT$18.05 (US$0.58), with 81.87 million shares changing hands, outperforming the broader market index, which was down 0.12 percent at 10,702.91. "So they have to import anyway", Greg Roh, an analyst at Hyundai Motor Securities, told Reuters in an interview.

China is escalating the trade war with the U.S. while making an announcement of a ban on the sale of products of Micron, a United States semiconductor company, in China. The Chinese court made a preliminary ruling on this.

The delay in approving the deal has coincided with uncertainty over the fate of Chinese smartphone and telecommunications company ZTE.

China represents about one quarter of the worldwide sales of memory chips, while half of the revenue generated by Micron is from sales in China, with an additional 12.5% from sales of chips in Taiwan. These Chinese companies would all need to find another supplier to meet their demand.

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