Boston, MA 05/15/2014 (wallstreetpr) – Amkor Technology, Inc. (NASDAQ:AMKR) loses an arbitration case against Tessera Technologies, Inc.(NASDAQ:TSRA), after which it is liable to pay nearly $125 million to Tessera. Reportedly, Amkor is found to have violated the terms of the agreement.
Amkor Breached License Agreement
The two parties had signed a license agreement in 1996, where in the both companies had agreed that all disputes would be brought under the purview of the International Court of Arbitration of the International Chamber of Commerce (“ICC”) and the final jurisdiction of the same will be final and binding on both the companies. As per the tribunal organized by the ICC, Amkor was found guilty of materially and intentionally breaching the license agreement, as a result of which Tessera Inc. was forced to terminate the agreement in 2011.
Following the decision, Tessera was awarded nearly $145 million, which is to be paid out by Amkor. Out of the total $145 million, Amkor has already paid $20 million in 2012, while unpaid principal amount of $113 million and another estimated interest of $12 million remains to be paid by Amkor Technology, Inc. (NASDAQ:AMKR). Apart from this, an extra interest at the rate of 10% will continue to accrue every year on the principal amount that stands unpaid.
In response to the arbitration tribunal decision, Tessera’s CEO, Tom Lacey said that the company is pleased that its rights were affirmed by the tribunal. Moreover, Lacey says that the binding award indicate the company’s commitment to enforce its license rights wherever necessary.
Hearing In June On Separate Case
In the meanwhile, Amkor Technology, Inc. (NASDAQ:AMKR) will face another arbitration hearing in June, 2014, where Tessera Technologies, Inc.(NASDAQ:TSRA) has claimed that the company has not paid the royalities to it on use of its patents. Amkor Technology, Inc., based in Chandler, is an outsourced semiconductor assembling and test services provider.
