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Flash Electronics alleges Royal Enfield infringed its patent on regulator rectifier device.
Flash Electronics India, an electronic and electric auto components maker, has sued Royal Enfield in the US for alleged patent infringement in the production of a motorcycle component.
This perhaps the first time that a homegrown auto ancillary company has taken a major auto company to the courts abroad.
The lawsuit comes at a time when Royal Enfield, the two-wheeler making arm of Eicher Motors, aims to improve slowing sales in India with its Interceptor and Continental GT 650 bikes.
"Royal Enfield is a responsible company that has been working with various suppliers for over 60 years, in a manner that meets all legal and regulatory requirements.
"Even though no official communication has been received, we have learnt of a lawsuit filed in the United States of America by Flash Electronics that alleges that one of the components used in some of our motorcycle models sold in the USA infringe on the plaintiff’s registered patent," said Royal Enfield in a statement.
"We would like to clarify that the said component is supplied to us by an external, proprietary supplier, which independently develops and owns the IP rights in the said component.
"The supplier denies plaintiff’s claims vehemently. We are actively evaluating the issue internally and seeking legal advice from our US counsels," it said.
New Delhi-based Flash has alleged that Royal Enfield infringed its patent on “Regulator Rectifier Device and Method for Regulating an Output Voltage of the Same” issued by the United States Patent & Trademark Office (USPTO) to it on February 20, 2018.
Flash says its R&D department invented the component in 2014.
“They (Royal Enfield) have taken some of our regulators and it has been copied blindly by another manufacturer (Varroc).
"So, I would say, Royal Enfield has got into this knowingly,” Sanjeev Vasdev, founder and managing director, Flash Electronics, told Business Standard.
Varroc has filed a caveat petition against Flash. A spokesperson for Varroc declined to comment.
“The litigations have been initiated in US and Europe hence the way forward will depend on the laws of those countries.
"Given the global clientele Flash caters to, it seems like a strong technology company and its important that it enforces its stand.
"It is one of the rare cases of an Indian company taking on another company in a foreign court,” said Gayatri Roy, Partner at Luthra & Luthra.
The regulator-rectifier is a vital component that smoothly and efficiently converts the AC (Alternating Current) voltage produced in motorcycle engines into D(Direct Current) voltage to charge the batteries, power the headlights, light up the instrument panel hence drives the motorcycle’s electrical systems.
Vasdev said Royal Enfield, after being warned on October 12, 2018, had assured his company it would stop infringing but “they never lived up to their talks.”
“They wanted to buy a few months then as they were getting into the launch phase of new products.
"I guess, it was a very calculative move by them at that time.
"I have not had this experience in the last 30 years.
"What they have done is totally unethical,” said Vasdev.
Besides USA, Flash has been granted patent in various other countries including many European countries including Germany, France, Italy, United Kingdom, the Netherlands, Sweden, Spain, Austria, Switzerland as well as Turkey and the company would be filing similar suits in the respective jurisdictions soon.
Photograph: Adnan Abidi/Reuters
