Toshiba sues Western Digital for $1 billion

Toshiba sues Western Digital for $1 billion

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The animosity between erstwhile memory partners Toshiba and Western Digital has reached new heights with Toshiba Corp. and the memory subsidiary it is trying to sell off have filed a lawsuit against Western Digital Corp. seeking to prevent the US company from interfering in the bidding process and $1 billion in damages.
By Peter Clarke

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Western Digital has argued that under joint venture agreements Toshiba was not free to move memory business into a holding company nor put it up for sale without obtaining its agreement first.

Those joint venture agreements on manufacturing NAND flash memory were original signed with SanDisk Corp. but transferred to Western Digital when it acquired SanDisk in 2016

Toshiba’s lawsuit claims that Western Digital has exaggerated its rights under those agreements – in both public statements and private communications to bidders and others involved in the sale process – in order to interfere with the sale of Toshiba Memory Corp. The complaint goes on to state that proceeding with the sales process for TMC does not violate any consent rights held by WD.

The lawsuit also claims that Western Digital has improperly transferred employees of SanDisk to Western Digital and that to prevent further damage to Toshiba and Toshiba Memory Corp. it is blocking Western Digital’s access to joint venture information with effect from June 28.

Western Digital, which has a manufacturing relationship with Toshiba, felt that it should be given first refusal on the acquisition of the memory business. Toshiba is trying to sell off what is now called Toshiba Memory quickly to raise cash to cover a massive write down in its nuclear power business.

Related links and articles:

www.toshiba.co.jp

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