DURHAM, N.C.--(BUSINESS WIRE)--Cree, Inc. (Nasdaq: CREE), a leader in LED lighting, announced today that it has reached a confidential settlement in its patent infringement and false advertising lawsuit with Feit Electric Company Inc. The settlement ends U.S. International Trade Commission ("ITC") investigation No. 337-TA-947 (“Certain Light-Emitting Diode Products and Components Thereof”) against Feit and its Asian supplier, Unity Opto Technology Co., Ltd. and the corresponding lawsuit in the U.S. District Court for the Western District of Wisconsin. The agreement also ends Feit’s claims against Cree in litigation filed in U.S. District Court for the Middle District of North Carolina. As part of the settlement, Feit and Cree have entered into a royalty-bearing license agreement to the Cree patents asserted in the ITC case and in Wisconsin. Feit will pay Cree a license issue fee and ongoing royalties as part of the license agreement, and Cree will receive a license to the Feit filament panel patents. The remaining terms of the agreement are confidential.
“Cree has invested over $1.2 billion in R&D over the past 10 years to create fundamental technology that has enabled the LED lighting revolution, and it is our obligation to protect our intellectual property,” said Chuck Swoboda, Cree Chairman and CEO. “This settlement and license agreement recognizes the value of our pioneering technology and ensures we are properly compensated while protecting consumers and Cree shareholders.”
Cree has secured patents for its innovations that are hastening the adoption of energy-efficient technology since the company’s founding in 1987. Cree’s licensing program, which includes over 20 licensing partners, allows other companies to use its proprietary technology, and supports these organizations’ pursuit of new markets and products. Where the license has been publicly announced, Cree licensees are listed on http://www.cree.com/About-Cree/Licensing/Licensees.
Business Outlook Update:
While the financial terms of the license agreement are confidential, as a result of the settlement, Cree now targets exceeding its previously announced revenue, net income and EPS targets for its second quarter of fiscal 2017 ending December 25, 2016. Cree will report its second fiscal quarter results and third quarter business outlook on January 24, 2017.
About Cree, Inc.:
Cree is a market-leading innovator of lighting-class LEDs, lighting products and semiconductor products for power and radio frequency (RF) applications. Cree believes in better light experiences and is delivering new innovative LED technology that transforms the way people experience light through high-quality interior and exterior LED lighting solutions.
Cree’s product families include LED lighting systems and bulbs, blue and green LED chips, high-brightness LEDs, lighting-class power LEDs, power-switching devices and RF devices. Cree’s products are driving improvements in applications such as general illumination, electronic signs and signals, power supplies and inverters.
For additional product and Company information, please refer to www.cree.com.
Forward Looking Statements:
This press release contains forward-looking statements involving risks and uncertainties, both known and unknown, that may cause actual results to differ materially from those indicated in the forward-looking statements. Actual results, including with respect to our targets and prospects, could differ materially due to a number of factors, including uncertain demand for products using the licensed technology; the risk that we may not obtain sufficient orders to achieve our targeted revenues; price competition in key markets; the risk that we or our channel partners are not able to develop and expand customer bases and accurately anticipate demand from end customers, which can result in increased inventory and reduced orders as we experience wide fluctuations in supply and demand; the risk that our commercial Lighting results will continue to suffer if new issues arise regarding the new ERP system we implemented in the third quarter of fiscal 2016 for this business; the risk that we may experience production difficulties that preclude us from shipping sufficient quantities to meet customer orders or that result in higher production costs and lower margins; our ability to lower costs; the risk that our results will suffer if we are unable to balance fluctuations in customer demand and capacity; product mix; risks associated with the ramp-up of production of our new products, and our entry into new business channels different from those in which we have historically operated; the risk that customers do not maintain their favorable perception of our brand and products, resulting in lower demand for our products; the risk that our products fail to perform or fail to meet customer requirements or expectations, resulting in significant additional costs, including costs associated with the potential recall of our products; the risk that retail customers may alter promotional pricing, increase promotion of a competitor's products over our products or reduce their inventory levels, all of which could negatively affect product demand; the risk that our investments may experience periods of significant stock price volatility causing us to recognize fair value losses on our investment; the risk that we have an increasingly complex supply chain and its ability to scale to enable maintaining a sufficient supply of raw materials, subsystems and finished products with the required specifications and quality; ongoing uncertainty in global economic conditions, infrastructure development or customer demand that could negatively affect product demand, collectability of receivables and other related matters as consumers and businesses may defer purchases or payments, or default on payments; the risk we may be required to record a significant charge to earnings if our goodwill or amortizable assets become impaired; our ability to complete development and commercialization of products under development, such as our pipeline of improved LED chips, LED components and LED lighting products; risks resulting from the concentration of our business among few customers, including the risk that customers may reduce or cancel orders or fail to honor purchase commitments; risks related to our multi-year warranty periods for LED lighting products; risks associated with acquisitions, divestitures or investments generally; the rapid development of new technology and competing products that may impair demand or render our products obsolete; the potential lack of customer acceptance for our products; risks associated with ongoing litigation; and other factors discussed in our filings with the Securities and Exchange Commission (SEC), including our report on Form 10-K for the fiscal year ended June 26, 2016, and subsequent reports filed with the SEC. These forward-looking statements represent Cree's judgment as of the date of this release. Except as required under the U.S. federal securities laws and the rules and regulations of the SEC, Cree disclaims any intent or obligation to update any forward-looking statements after the date of this release, whether as a result of new information, future events, developments, changes in assumptions or otherwise.
Cree® is a registered trademark of Cree, Inc.