EV battery manufacturer SK Innovation (SK) has agreed to pay KRW2trn (US$1.8bn) to settle a two year long technology infringement dispute with LG Energy Solution (LG).
In return, LG agreed to withdraw all outstanding litigation against SK, hours before the US was due to impose an import ban on SK products by order of the US International Trade Commission (ITC).
In February the ITC judged in favour of LG in the trade secret infringement dispute and issued a 10-year ban on SK imports into the US while allowing it to temporarily ship batteries to Ford and Volkswagen to allow them time to find new suppliers.
SK agreed to pay KRW1trn in cash to LG and a further KRW1trn in royalties on future sales with both parties agreeing to withdraw all legal disputes in South Korea and overseas and to not lodge any further complaints for a decade.
In a joint statement LG Energy Solution CEO Kim Jong-hyun and SK Innovation CEO Kim Jun said: “Our two companies agreed on sound competition and friendly cooperation for the development of the EV battery industry in South Korea and in the United States.
“We have agreed to make joint efforts for the Biden administration’s push to bolster the EV battery supply chain and its eco-friendly policy.”
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataSK can now push ahead with plans to build a US$2.6bn plant in Georgia which will supply EV batteries to Ford and Volkswagen.
The company, which claims to have developed its own technology and manufacturing processes for EV batteries, had previously said it might shut down the project if the import ban was not overturned.
LG already operates a lithium-ion battery factory in Michigan and is building a new factory in Ohio in a joint venture with General Motors which is scheduled to be completed in 2022.
