Toshiba Loses Chip Lawsuit

Toshiba Corp., Japan’s No. 2 semiconductor maker, must pay $322.7 million to Lexar Media Inc. in a lawsuit over technology used to make computer chips in digital cameras, cellphones and MP3 players, a San Jose jury said Wednesday.

The Santa Clara County Superior Court jury agreed with Lexar’s claims that Toshiba broke a 1997 agreement to use and co-develop the flash memory technology, used to make chips that transmit data, and then shared it with SanDisk Corp., Lexar’s largest competitor.

“It’s disturbing that it took two years and millions of dollars of Lexar’s money to get Toshiba to acknowledge what it should have acknowledged years ago,” said Eric Whitaker, Lexar’s general counsel.

The verdict assesses an additional $58.7 million against Toshiba America Electronic Components Inc.

Whitaker said a hearing to determine punitive damages was scheduled for today.

Fremont, Calif.-based Lexar was seeking more than $1 billion in damages and a court injunction stopping the sale of Toshiba products that use Lexar’s technology.

A spokeswoman for the America Electronic Components unit did not immediately return a call seeking comment.

Lexar said last week that it expected to post as much as a $65-million loss in the fourth quarter.

Its shares rose $1.51, or 48%, to $4.68 in extending trading on Nasdaq, after the verdict was announced. In regular trading, shares rose 17 cents to $3.17.