Philips Electronics China Group, a subsidiary of Europe's largest consumer-electronics maker, said yesterday it had provided evidence to the State Intellectual Property Office to invalidate the patent and is prepared to fight the claim.

The suit was originally filed in the Shanghai Intermediate People's Court in August last year by the privately owned Shanghai Dais Electric Co. It is only recently both parties have started to talk about the issue.

In the suit, Shanghai Dais states that Philips & Yaming Lighting Co Ltd used its utility model patent illegally from 1995 to 2000.

Philips & Yaming is a joint venture of Philips China, which has a 60 percent stake in the firm.

"We conducted an internal investigation immediately and found that the lamps were purchased from OEM supplier CMEC (CMEC Engineering Import & Export Co Ltd) which stopped supplying the products using the alleged patent from January 1, 2001," said Philips China in a statement.

It also stressed an indemnification clause in the OEM contract between Philips & Yaming and CMEC. It states CMEC has full responsibility to settle the case and indemnify Philips.

"We think it is not proper to conclude that the product has infringed the other party's right," said Philips China. "We are waiting for the judgment of both organizations."

Dai Peijun, general manager of Dais, who owns the patent rights, told Shanghai Daily yesterday that he had presented evidence to the court in May and was collecting more.

"Statistics collected from the Customs show that Philips exported about 50 million bulbs using my patent. The sales figure in the domestic market may be much bigger," he said.

"My patent has been widely infringed by domestic bulb makers, and Philips is among the three firms that I have brought suits against," he added, declining to identify the other two.

A Philips China official said Dai's patent had already been widely used in producing energy-saving bulbs before his 1993 registration.

"We have collected enough evidence for the court to prove it," the Philips official said.

Dai said the patent expires in May 2003 but the infringement and charge occurred during the effective period of the patent.

Since China joined the World Trade Organization more domestic companies have been going to court to seek damages.

It's the second dispute between Philips and a domestic energy-saving bulb maker.

In early 2000, Philips and Germany's Osram and Sylvania accused Chinese manufacturers of selling energy-saving lighting products below production costs in the European Union.

Philips withdrew the action in December 2000. Still, the European Commission started an investigation and imposed five-year duties of up to 66.7 percent on Chinese-made compact fluorescent bulbs in July 2001.

Chinese light bulb makers, stung by the stiff anti-dumping tariffs, have increasingly shifted their sales to the US and other new mar-kets. Some have also transferred their production to Southeast Asian countries that have not felt the heat of the EU investigators.

(Shanghai Daily July 4, 2003)