LG enters US patent dispute against Hisense

The patents in question affect the majority of TVs sold by Hisense in the United States, LG alleges.
Written by Cho Mu-Hyun, Contributing Writer

LG Electronics has filed a lawsuit against Hisense alleging that the Chinese TV manufacturer has violated its TV-related patents, the company announced on Tuesday.

The South Korean electronics maker filed the lawsuit against its Chinese rival in the Central District of California for allegedly violating four patents. As part of the patents dispute, LG is demanding an unspecified amount in damages. 

See also: LG needs to decide where OLED should live      

The first patent in question is related to LED light assembly technology, which is used to transfer LED backlights to LCD panel in a stable manner. The second patent is for user interface technology that helps users to recognise third party devices -- such as DVD players or computers -- when they are connected to the TV, while the third patent is related to technology that makes images on displays sharper. The final patent that is part of the lawsuit is for technology that increases Wi-Fi data transfer rates on TVs.

LG claims the majority of TVs sold by Hisense in the United States use these patents.

LG said it sent warnings and requests for talks "numerous times" to Hisense earlier this year, but the Chinese company had acted "insincerely", forcing the company to start the lawsuit.

"We will aggressively protect our patents," the South Korean company said in a statement. 

Clawing its way out

LG Electronics is the world's second largest TV manufacturer after Samsung Electronics, but its profits were hemmed by its compatriot arch-rival and Chinese upstarts at the start of this year. 

During the second quarter, LG saw its shipment totals decline by 700,000 from the previous quarter, which sent alarm bells throughout the company as the second quarter is generally when TV manufacturers have their strongest performance due to new product being released at their highest prices. LG saw its profits halved in the second quarter compared to the same period a year ago. 

Hisense, meanwhile, has grown to become the fifth largest company globally in terms of sales figures and the fourth largest in shipment totals. According to IHS Markit, Samsung had the most market share globally in TV sales during the second quarter, holding 31.5% of market share. This was followed by LG's 16.5% and Sony's 8.8%, but the Chinese manufacturers TCL and Hisense were not far behind, owning 6.3% and 6.2% of market share, respectively. 

In terms of shipment market share, Samsung controlled 19.4% in the same quarter, while LG came second with 12.4%. TCL and Hisense, meanwhile, came in at third and fourth, respectively, controlling 9.4% and 7.3%.

See also: LG reduces mobile losses for Q3  

But LG has since recovered from the set back somewhat, with its third quarter profits being only slightly down compared to the previous year. During the third quarter results announcement, LG said it was optimistic and promised to offer a "stable profit structure" for its OLED TV line-up that would be commensurate to a premium consumer device to ensure further growth going forward. 


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