Samsung Cleared by Jury in $4 Billion Chip-Making Patent Lawsuit

Samsung Electronics Co. didn’t infringe Demaray LLC’s semiconductor patents by buying reactors for its semiconductors products at fabrication and research facilities, a Texas jury determined.

The jury in the US District court for the Western District of Texas notified the court twice that it couldn’t reach a unanimous decision before finally reaching a verdict late Friday. The jury didn’t decide on the validity of the two patents at issue, US Patent Nos. 7,544,276 and 7,381,657.

Demaray had sought more than $4 billion in damages.

Employees of Samsung’s supplier Applied Materials Inc. testified throughout the trial. Judge Alan Albright abruptly stopped a cross-examination of an Applied Materials employee Thursday by Demaray after attorneys mentioned an alleged criminal investigation against the supplier during the trial.

The judge instructed the jury to leave the courtroom. Albright, while standing, told the court there would be a short recess “so that I can calm down.” He told Samsung’s counsel to use the break to decide if it wanted a mistrial.

Michael W. De Vries of Kirkland & Ellis LLP, counsel for Samsung, told the court after the break the company is “greatly concerned” about the comments which it believed to be “categorically 100% false” and prejudicial. However, the company chose to continue the trial and reserve the right to ask for a new trial based on the jury’s verdict.

Adam R. Alper of Kirkland & Ellis, counsel for Samsung, told the jury during closing arguments that even though they must ignore the criminal investigation comment, they should take a step back and wonder why Demaray mentioned it in the first place. Alper questioned whether Demaray is trying to do anything it takes to get billions of dollars in damages.

Morgan Chu of Irell & Manella LLP, counsel for Demaray, told the jury that Samsung had done “distracting things” during the trial. Chu said the jury shouldn’t penalize Demaray for being a small company going up against a large corporation.

Samsung and Demaray didn’t immediately respond to requests for comment.

Demaray sued Samsung and its units Samsung Austin Semiconductor LLC, Samsung Semiconductor Inc., and Samsung Electronics America Inc. in July 2020 alleging the Korean company supplied reactor components to its manufacturing facilities and sold products utilizing methods for magnetron sputtering—a physical vapor-deposition technique, according to court records—that infringed its patents. Demaray is named for its founder and the co-inventor of the two patents, Richard Ernest Demaray.

Samsung denied the allegations in September 2020, and later argued the patents were invalid.

The Patent Trial and Appeal Board in June 2022 upheld the validity of the patents.

Irell & Manella LLP, Folio Law Group PLLC and McGinnis Lochridge LLP represent Demaray. Kirkland & Ellis LLP and Desmarais LLP represent Samsung.

The case is Demaray LLC v. Samsung Electronics Co. et al, W.D. Tex., No. 6:20-cv-00636, verdict issued 2/16/24.