A United States commerce committee ruled in favor of South Korean electric vehicle battery manufacturer LG Chem, which had accused competitor SK Innovation of mishandling confidential company information, LG Chem disclosed on Sunday.
The two crosstown rivals have slapped hit each other with US charges for stealing trade secrets and patent violations in a deepening animosity that could potentially impede the unveiling of electric cars by some of the largest car companies in the world.
The initial determination by the International Trade Commission could mean SK Innovation, as sought by its competitor, will be banned from importing some battery components the company may need to supply its facilities for Ford Motor and Volkswagen in the US.
LG Chem will thus move ahead of its rival after receiving a favorable decision from the USITC, the company stated. The battery-making unit of LG Group disclosed that the USITC made a "default judgment" against SK Innovation on February 14, accepting its charge that its rival tried to hid proof of infringement on its battery-making patents.
A $1.7 billion battery plant in Georgia is currently being set up by SK Innovation to cater to Volkswagen's electric vehicle facility in nearby Tennessee, with full production set to roll out in 2022. The company is also planning to build another batter facility in Georgia to supply Ford's electric pick-up trucks.
The Seoul, South Korea-headquartered SK Innovation currently makes batteries for Kia Motor's Niro electric vehicles, which are made in the country and exported to the US.
LG Chem and SK Innovation have been embroiled in a legal showdown since April last year after LG filed a pair of charges with the USITC and a US court, respectively, against SK for allegedly stealing battery technology.
LG Chem then revealed that it discovered more than 34,000 emails and files that showed SK Innovation attempted to tamper with proof that it stole battery-making trade information from LG.
Auto companies are jockeying for position to corner a huge chunk of battery supplies, which have become the most expensive and crucial element of electric vehicles, to conform with strict emissions laws and growing consumer demand. LG Chem is the third biggest battery manufacturer in the world, next to China's CATL and Panasonic of Japan.
Meanwhile, in reaction to the default ruling, executives at SK Innovation expressed dismay and said they will start the appeal process. SK added there will be no change in its operational structure and that LG Chem is its business partner to "develop the battery industry's ecosystem together."
