SHANGHAI (Reuters) – Shares of Apple Inc supplier Luxshare Precision Industry Co Ltd fell as much as 9.5% on Monday, amid new concerns over a US patent infringement investigation filed against it.
On Sunday, in an exchange filing, the company said it was notified of two notices issued by the United States International Trade Commission (USITC) regarding a Section 337 investigation filed against it by Amphenol Corp, with based in the United States, for alleged infringement of intellectual property.
Luxshare said it had hired a team of lawyers to respond and would “go through the process” on the investigation, without elaborating, but reiterated that the case “will not have a material impact” on its current operations and production.
Amphenol filed a lawsuit in Section 337 against Luxshare and its subsidiaries in December, alleging that some electrical components imported into the United States by Luxshare infringe Amphenol’s patents for connecting cables.
Days later, Luxshare released a statement claiming it learned of the complaint via the USITC website and added that it had established an internal working group to investigate the allegations.
Founded in 2004, Luxshare has become a rapidly growing supplier for Apple in recent years. It has steadily shifted the hardware giant’s value chain from manufacturing connection cables for iPhones and Macbooks to manufacturing Airpods.
Last year, the company acquired two iPhone assembly plants from Taiwan-based Wistron Corp.
This move has unnerved some executives at Foxconn, the dominant phone maker, and is seen by analysts as a sign of more indigenous Chinese companies making their way into Apple’s supply chain.
Reporting by Josh Horwitz; edited by Richard Pullin
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