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Announcement of Newland|Withdrawal of A Lawsuit Involving Newland

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News: Newland (000997) announced on May 4 that the Company has recently received the civil ruling issued by Shanghai No. 2 Intermediate People’s Court approving the Plaintiff’s (Metro (Suzhou) Technologies Co., Ltd.) withdrawal of a lawsuit concerning dispute over patent infringement against Newland Science & Technology Group Co., Ltd., Fujian Newland Computer Co., Ltd. and Fujian Newland Auto-ID Tech. Co., Ltd.. This case will not affect the profits of current period and subsequent period of the Company.


It is reported that in 2011, Honeywell (Plaintiff’s parent company in United States) notified Fujian Newland Auto-ID Tech. Co., Ltd. of a disagreement over patent issues of products, then both parties tried to settle the disputes but failed.


In 2012, the Plaintiff, Metro (Suzhou) Technologies Co., Ltd. (a wholly-owned Chinese subsidiary of Honeywell) was assigned the patent ownership from Honeywell, which is granted in China. The Plaintiff lodged a lawsuit with the Shanghai No. 2 Intermediate People’s Court in the same year and then filed for withdrawing such lawsuit on March 31, 2016.


Litigation Background:

Since the development of barcode technology, especially the 2D barcode business, the Company and its subsidiaries Newland Auto-ID Tech. Co., Ltd. have been making good progress in domestic and international patents involving independent core technology, application products, market development and core competence. The Company’s major competitors for 2D technology products are those foreign manufacturers.


In 2011, Honeywell, the U.S. parent company of Metro (Suzhou) Technologies Co., Ltd. (hereinafter referred to as “Metro Company”) raised that the related products of the Company infringed Honeywell’s U.S. patents and Chinese patents of the same subject, requiring the payment of patent royalties. The Company expressed its disagreement and asked for negotiations for settling the dispute, but failed.


In April 2012, the Company filed patent invalidation proceeding against the patent at issue with the Patent Reexamination Board of State Intellectual Property Office of the People’s Republic of China.

In March 2012, Honeywell assigned its patent ownership granted in China to its Chinese subsidiary, “Metro Company” (i.e. the Plaintiff), and a lawsuit was filed with the Shanghai No. 2 Intermediate People’s Court in June 2012.


In March 2016, the Patent Reexamination Board of State Intellectual Property Office of the People’s Republic of China issued the “Examination Decision on Request for Invalidation”, which was in favor of Newland’s request for invalidation, holding that those related claims of such Chinese patent owned by Honeywell was invalid. In the same month, Metro (Suzhou) Technology Co., Ltd. filed a petition with the Shanghai No. 2 Intermediate People’s Court for withdrawing the lawsuit against Newland Science & Technology Group Co., Ltd., Fujian Newland Computer Co., Ltd. and Fujian Newland Auto-ID Tech. Co., Ltd. and such petition was approved by the Court.



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