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Mitsubishi to Pay GE $170 Million

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Mitsubishi Heavy Industries Ltd. must pay about $170 million to General Electric Co. after a jury in the U.S. found the company infringed a wind-turbine patent.

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Manufacturing Group March 13, 2012

Mitsubishi Heavy, Japan’s biggest heavy-machinery maker, will challenge the verdict and seek to have the GE patent ruled unenforceable in a second phase of the trial in Dallas, according to a statement today from the Tokyo-based company. A second GE patent, related to the turbines’ base design, was ruled invalid by U.S. District Judge Royal Ferguson on Feb. 10.

GE accused Mitsubishi Heavy of infringing a patent on a way to keep turbines connected to utility grids during voltage fluctuations without sustaining damage. The dispute is part of an effort by GE to maintain its market lead in the U.S., where the Fairfield, Connecticut-based company says it has made about half of the turbines in use.

“It is important to see this case within the larger context: as part of a GE litigation strategy that would stifle competition and innovation in wind turbine technology,” Sonia Williams, a spokeswoman for Mitsubishi Heavy in the U.S., said in the statement.

Chet Lasell, a GE spokesman, said the company had no immediate comment.

Wind Capacity
GE claimed that at least 179 Mitsubishi Heavy turbines made for Iberdrola SA (IBE)’s renewables unit and Edison Mission Energy infringe the first patent. Mitsubishi Heavy signed contracts with the power companies in 2007 and 2008, and the turbines were installed in 2010 and 2011. A 2.4-megawatt wind turbine, the type at the center of the trial, costs about $2.9 million, based on estimates of capacity costs in the Bloomberg New Energy Finance Wind Turbine Price Index (WTPIPALL).

The U.S. has the second-largest amount of wind capacity in the world, trailing China, according to a Feb. 7 report by the Global Wind Energy Council.

The Dallas suit was filed after GE lost a case at the U.S. International Trade Commission to block Mitsubishi Heavy turbine imports. An appeals court on Feb. 29 ordered the ITC to review findings on one GE patent, reviving part of the case.

Mitsubishi Heavy filed an antitrust lawsuit in Arkansas accusing GE of trying to monopolize the wind-turbine market. That suit is on hold, pending the outcome of the patent cases. The company also has a patent-infringement complaint against GE in federal court in Orlando, Florida.

Susan Decker, Bloomberg News, sdecker1@bloomberg.net;

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