Mitsubishi Electric Loses $124 Million Jury Verdict to Grail

Mitsubishi Electric & Electronics USA Inc. was told by a California jury to pay Grail Semiconductor Inc. $124 million in a breach-of-contract lawsuit.

Mitsubishi Electric disclosed Grail’s confidential information for a memory chip to an affiliate company, Mitsubishi-Japan, and a jointly owned Japanese company, Renesas, Raymond P. Niro, a lawyer representing Grail, said in a phone interview.

Yesterday’s verdict, issued by a state court jury in San Jose, is the seventh-largest jury award in the U.S. so far in 2012, according to data compiled by Bloomberg. The largest, for $900 million, was awarded by a Florida jury to a nursing home resident who suffered multiple injuries from untreated bed sores.

“We believe that the decisions on liability and damages are fundamentally flawed and that Mitsubishi Electric & Electronics USA Inc. will be fully vindicated,” David S. Elkins, a lawyer representing Mitsubishi Electric, a unit of Tokyo-based Mitsubishi Electric Corp. (6503), said in an e-mail.

Grail co-founder Donald Stern met with a team from Mitsubishi Electric in April 2001 in San Jose and “disclosed technology for a memory chip,” Niro said. Mitsubishi Electric “took the information, introduced it and captured the market,” Niro said.

Grail and Stern sued, claiming Mitsubishi Electric used the technology on memory chips it introduced in 2004, Niro said.

The case is Grail Semiconductor Inc. v. Mitsubishi Electric & Electronics USA Inc., 1-07-cv-098590, Santa Clara County Superior Court (San Jose).

To contact the reporters on this story: Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net;

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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