A U.S. court has ruled in favor of Kevlar manufacturer DuPont and barred Kolon from selling a similar competing version of the bullet-proof fabric in the U.S. and other countries for the next 20 years.
In November last year, the court ordered Kolon to pay DuPont US$920 million, accusing the Korean company of stealing trade secrets. The amount was more than 300 times greater than Kolon's total exports of the aramid fiber to the U.S. over the last five years.
In 2005, Kolon says, it succeeded in developing its own aramid fiber after 26 years of research. The fiber is used in a wide-range of applications, from bullet-proof vests to fiber-optic cables. But DuPont accuses the Korean company of hiring ex-DuPont staff and essentially stealing Kevlar.
As in the recent Samsung-Apple trial in Northern California, questions were raised about the validity of latest verdict amid rumors that the judge in the case used to represent DuPont in previous trials against other Kevlar-like fabric manufacturers when he was an attorney.
The latest flood of patent lawsuits by U.S. companies against their Korean rivals is also reminiscent of the legal battles they waged against Japanese businesses in the 1980s. The number of lawsuits filed by U.S. businesses against Korean companies surged over the last two or three years to reach 117 as of last year.
Korean businesses urgently need to change the way they think about patented technologies. American businesses regard intellectual property, including patents and trade secrets, as one of the key areas that will lead their growth in the coming years. U.S. laws governing intellectual property have grown to cover a vast field, ranging from cheerleaders' uniforms to restaurant menu designs and even a particular color used in a specific product.
According to World Intellectual Property Organization statistics, Korea ranked fifth in the world in terms of international patents at 10,447 in 2011, after the U.S., Japan, Germany and China. But domestically it shows a lack of awareness of the value of innovation.
Some 60 to 70 percent of patents that are filed domestically are nullified every year, which is the highest rate in the world, and in only 20 percent of patent infringement cases do courts rule in favor of patent-holders, which is the lowest in the world. Even if a patent holder here wins a case, he or she receives an average of only W50 million (US$=W1,134) in compensation, also the lowest in the world.
Sony, one of the world’s leading electronics makers, started to go downhill when its development of core technologies lost steam. The government needs to take the initiative to promote research into novel technologies and offer support. Companies for their part should come up with strategies to keep up with today's innovative competition, including handsome rewards for staff who develop new technologies.