Seagate wins $525 million from Western Digital

Seagate wins $525 million from Western Digital

Summary: While the hard drive shortage continues, Western Digital suffers another loss.

TOPICS: Storage, Hardware

Western Digital has suffered a major hit as rival Seagate Technology wins an arbitration award worth $525 million, pending confidential arbitration action in Minnesota.

Basically, the arbitration award is based upon claims by Seagate against Western Digital and a former Seagate employee. Seagate argues that the said individual allegedly misappropriated confidential information and trade secrets.

Despite the pending award, Western Digital is denying the validity of these claims.

Western Digital president and chief executive officer John Coyne commented in a statement:

We do not believe there is any basis in law or fact for the damage award of the arbitrator. We believe the company acted properly at all times and we will vigorously challenge the award. This does not affect our ability to conduct our operations, to complete the recovery and recommencement of our Thailand operations or, subject to obtaining the required regulatory approvals, to consummate our planned acquisition of Hitachi GST.

Note that the $525 million award amount does not include prejudgment interest, which will be determined later.

Don't forget that Western Digital must also be reeling considering the flooding in Thailand, which has led to a major hard drive shortage throughout the industry.


Topics: Storage, Hardware

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  • RE: Seagate wins $525 million from Western Digital
    • RE: Seagate wins $525 million from Western Digital

      GO AWAY !
  • RE: Seagate wins $525 million from Western Digital

    One more thing to keep the prices high . We need to make them here in the US.
    • RE: Seagate wins $525 million from Western Digital

      wouldn't that make the prices even HIGHER.....
      • RE: Seagate wins $525 million from Western Digital

        @TTPinc yes if everything we bought here in the USA was made here, the prices would be through the roof, do people think that if Seagate gets this extra money their prices will come down, no way, if Weatern can't make the demeands, Seagate will raise thier prices, screwing us that buy computers with their drives in them
      • RE: Seagate wins $525 million from Western Digital

        Not necessarily. American workers are more productive and will put out more units per worker than their foreign counterparts. Also american factories tend to be more automated and robots don't sleep. They also don't get paid (yes there is overhead to running them.). It depends. Certainly the manufacturers get tax breaks for producing overseas, but that has to stop. When i go through a store and look at products, American products aren't really any more expensive than their foreign counterparts. I'll be the American product first and Western Digital is shifting some manufacturing to the US as is Seagate. We won't get into the stupidity of building a factory on a floodplain in Thailand.
      • RE: Seagate wins $525 million from Western Digital

        @bombardj1 If everything we bought here in the USA was made here, the economy (and wages) would be through the roof, and we could afford the higher prices. In the 1950s the average manufacturing job paid enough to be able to support a family on one income, take a vacation every year, and retire securely.

        If Congress taxed items from overseas an amount equal to the amount saved from paying less than minimum wage, not having environmental and safety regulations in that country, etc., then there'd be no advantage to manufacturing in an undeveloped country and products would be able to compete squarely on quality and cost (through efficiency, not through exploiting third world nations). I believe this idea was actually floated by the Nixon administration (who'd never be considered a Republican today) but never acted on.
      • RE: Seagate wins $525 million from Western Digital

        Strange that Honda, Toyota, Hyundai, Kia, and other companies can make their products over here using US labor without a resultant increase in price.
      • RE: Strange that Honda, Toyota, Hyundai, Kia....


        The wage of those factory workers is usually considerably less than those of American Car companies and the benefits are not as much. Of course some fault of the American companies falls on old ideals and practices from those in charge refusing to change and adapt to the times. Unions also play a big role and I feel that the original purpose unions were formed have lost its purpose for the most part and do not protect the worker or the job as much as they protect the union big shots.
      • RE: Seagate wins $525 million from Western Digital

        @curtis - is that so? As far as I remember just 7 years ago France was the most productive country in the world. Now US leads, but only because of the services sector, not manufacturing, which is on par with EU. So I doubt very much that that will the case. Also, when robots work, that doesn't count for how productive people are, but rather the companies. Which is also the explanation why companies like Hyundai succeed: highly automatized factories, which when you pay for them yourself, as did Hyundai rather than loaning, can become profitable much sooner, despite slightly higher wages (S Korea is not exactly a cheap country either). Also, can you please explain how come you think HDD's are manual made? That's high tech, it's extremely automatized, human contribution past the drawing board is minimal. Why do you think they went into exotic countries in the first place? Because they don;'t need high tech people (which US has in plenty) to run the place, machines will do the stuff, so I doubt that productivity will be greatly improved using Americans. Only cost will go up. And with HDD unlike cars, the margins are very low, so sorry, I don't think you'll see any US made HDD soon.
      • so how much did prices drop...

        So, how much did disk drive prices drop when they shut down the factory in Oklahoma City and moved production to Red China or Indonesia or whatever?
    • RE: Seagate wins $525 million from Western Digital

      @stv7575 I agree. All of these lawsuits and patent infringement claims get passed onto the consumer in the form of higher prices and lower-end products. I wish these companies would just focus on making a great product at a fair price and try to find ways that would benefit their consumers rather than these piddly little lawsuits that cost millions in a declining economy.

      • RE: Seagate wins $525 million from Western Digital

        @heymatthew You forget that layers need work too. I understand that we as a nation have far more lawyers than engineers. So these lawsuits are job creators.
    • RE: Seagate wins $525 million from Western Digital


      I for one would be willing to pay more for something made in America that being said I now find many American made products to be of better quality and cheaper.
      • RE: Seagate wins $525 million from Western Digital

        @saminsc I agree, I would also pay more for items made in USA.
    • Trade creates wealth, not protectionism

  • I ain't happy with WD anyway...

    I can't prove it, but it is my opinion - only - that they started designing their "consumer" drives to ensure that they'd drop out of RAID sets under heavy use.

    lollll...either that, or the one thing they [i]didn't[/i] steal from Seagate was error recovery microcode (again, just my opinion).
    • RE: Seagate wins $525 million from Western Digital


      Seagate does this too. In fact they will void the warranty if you RAID a consumer class drive. My organization put together some NAS boxes and used Seagate drives and put them in a RAID5 configuration. Had many of them fail only for Seagate to deny the claim because evidence of a RAID configuration was found.
      • RE: Seagate wins $525 million from Western Digital

        Just to keep you buying server class drives (better warranty, BTW). Pay extra and get a drive that won't fail. WD drives have a high failure rate anyway. My seagates just run. I've had a 100% failure rate with Hitachi.
      • RE: Just to keep you buying server class drives


        So you dont't believe that products should be made differently for the primary function they are to be used for? So you would go buy a nice shiny new pick up with chrome rims intended for daily driving and light hauling and then complain when you work it to the bone and blow something and you should have purchased a Heavy Duty Pickup?

        Just using the information from our warranty claims for the past 3 years sorted by part number I can honestly tell you that over 75% of the hard drive failures have been with Seagate drives in the thousands of machines I manage for my organization. The mechanical hard drive is always going to have a high failure rate due over other parts of the system that do not have moving parts and your experiences may differ.

        The point is you need to buy the right tool for the job and the WD RE4 drives we have used to replace the Seagate drives that failed repeatedly in the same systems still run like a top and were worth the 20% increase in cost compared to a consumer class drive.