Date
15 December 2017
Toshiba has accused Western Digital of interfering in the attempted sale of the Japanese firm's flash-memory chip business. Photo: Reuters
Toshiba has accused Western Digital of interfering in the attempted sale of the Japanese firm's flash-memory chip business. Photo: Reuters

Toshiba sues Western Digital for US$1.1 bln

Toshiba Corporation has sued Western Digital for 120 billion yen (US$1.1 billion), accusing the US firm of interfering in the attempted sale of the Japanese technology giant’s flash-memory chip unit.

The litigation, filed Wednesday in Tokyo District Court, seeks to stop Western Digital from making ownership claims over the enterprise that Toshiba is trying to sell, Bloomberg reports.

Last month, Western Digital invoked an arbitration clause in their business agreement, seeking to block Toshiba’s transfer of ownership of the unit to a separate legal entity in preparation for a sale.

Toshiba, which has since reversed that transfer, then had its lawyers send a letter demanding that the US firm stop its “harassment” as Toshiba tries to sell the business.

Last week, Toshiba said a group led by the Innovation Network Corp. of Japan, Bain Capital and other investors were the preferred bidders for the semiconductor business, and that it’s aiming to reach final agreement and close the deal by March 2018.

The consortium is offering 2.1 trillion yen (US$19 billion) for the unit, according to Bloomberg sources.

Toshiba has argued that Western Digital failed to formalize their relationship after the US firm became Toshiba’s manufacturing partner in the flash-memory business when it acquired SanDisk for US$15.8 billion last year.

The Japanese company said on Wednesday that it will start blocking Western Digital’s access to information in the joint venture, in order to protect its trade secrets.

Toshiba’s claims for damages include the loss of information, as well as for interfering in the sales process.

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RC

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