Xinyi and Saint-Gobain "Are Actively Engaged" in Settlement Discussions Regarding Patent Infringement Case, According to Court Documents
July 26, 2010

Officials from both Xinyi Glass and Saint-Gobain have said they are "actively engaged in settlement discussions" in the ongoing patent infringement suit, according to recent court documents filed in the case. In addition, Xinyi officials have said that, if a settlement agreement is not reached, they intend to provide a letter of credit by August 6 for the debts owed to Saint-Gobain as a result of the suit.

Xinyi Glass North America Inc. and Xinyi Automobile Glass Co. Ltd. together owe Saint-Gobain approximately $24 million as a result of the April judgment made against it. Saint-Gobain had filed a motion seeking an expedited discovery in early July, in hopes of identifying Xinyi's assets, but has since withdrawn that motion, citing both the settlement dicussions and Xinyi's alleged agreement to provide a letter of credit in early August. (CLICK HERE for related story.)

"The parties are actively engaged in settlement discussions," writes Saint-Gobain in its motion to withdraw its previous motion for expedited discovery. "Further, the details for a letter of credit have been negotiated and completed and defendants Xinyi Glass North America Inc. and Xinyi Automobile Glass Co. Ltd. (collectively, 'Xinyi') have promised to provide the letter of credit by August 6, 2010, to provide responses to Saint-Gobain's discovery requests while the parties try to settle this matter."

In addition, though Saint-Gobain had requested depositions of Xinyi representatives in an effort to identify its U.S. assets, the company also has agreed to postpone this "in hopes that this deposition will not be necessary."

While Xinyi officials have filed a memorandum of "no objection" to Saint-Gobain's motion, company representatives do note that though they "intend to have a letter of credit issued as a substitute for a supersedeas bond as security for a stay of the judgment pending appeal, should the case not settle … Xinyi has not promised that the letter of credit will issue no later than August 6, 2010."

"As Xinyi has represented to Saint-Gobain and to this Court, the Chinese government controls the outflow of domestic and foreign currency," writes the company. "If for any reason the Chinese government does not give final approval, Xinyi will not be able to have the letter of credit in place by August 6, 2010."

Xinyi officials also have said whether they are able to produce the letter of credit by August 6 will impact other items in the case.

"If the letter of credit is in place, Xinyi will not respond to any discovery in aid of execution," writes the company. "If the letter of credit is not in place, Xinyi will respond to the interrogatories and requests for production of documents no later than August 6, 2010."

In addition, Xinyi has filed a motion for a protective order to "preclude corporate representatives of Xinyi from being forced to travel to the United States for their deposition in aid of execution of the judgment." The company requests that any depositions be held either at Xinyi's "principal place of business or at a location convenient for the deponents."

Xinyi had requested (and was granted) an extension in April to secure financing for the debt owed to Saint-Gobain. That extension went until May 31. (CLICK HERE for related story.) Then, as the May 31 deadline approached, the company filed a motion for the court to vacate or adjust the damages against it, or to provide a new trial. (CLICK HERE for related story.) Around May 31, Saint-Gobain says Xinyi also "sought an extension so it could secure a Letter of Credit (LOC)"—an extension that went until June 15.

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