It looks like things between Toshiba and Western Digital are about to get ugly. Last week, we learned that WD was unhappy with Toshiba’s efforts to sell its share of a NAND flash factory in Japan and now, Toshiba is firing back with a massive £835 million lawsuit, accusing Western Digital of violating Japan’s Unfair Competition Prevention Act.
Toshiba is looking to sell off its memory chip making business in an effort to save itself from financial ruin following a major accounting scandal. Right now, Toshiba Memory Corp owns 50 percent of a NAND flash manufacturing plant in Japan, the other 50 percent was originally owned by SanDisk but was passed on to Western Digital after WD acquired SanDisk. Since WD owns half of the plant, the company says it should have a say in the sale of Toshiba’s half.
Toshiba obviously takes issue with that notion. In a statement sent out this week, Toshiba announced that it was seeking an injunction against Western Digital for “acts of unfair competition”. The company also filed a separate suit seeking damages, a permanent injunction and a 120 billion yen payout for violation of Japanese competition laws.
According to Toshiba, WD has “exaggerated its consent right” in public and in private communications to those looking to bid on Toshiba Memory Corp. Essentially, it says WD is interfering with the sale in an effort to damage Toshiba. Whether or not that is actually true is for a court to decide.
KitGuru Says: It looks like things are getting ugly between Toshiba and Western Digital. So far, WD has not responded to Toshiba’s lawsuit but I am sure we will hear more from both companies sooner or later.