CATL ups ante to $78 mln in patent suit against biggest chaser CALB

The world's largest battery maker electric vehicle (EV) battery maker Contemporary Amperex Technology Co., Ltd. (CATL) (宁德时代新能源科技股份有限公司) has amended its claims against smaller rival China Lithium Battery Technology Co. (CALB) (中创新航科技股份有限公司) by seeking an award of damages in the amount of 518 million yuan ($78 million), robustly inflated from 185 million yuan ($28 million) in the original complaint, according to Time Finance.


Batteries are crucial components of EVs and Chinese companies are expanding production globally. Ningde city, Fujian province-headquartered CATL, with a current market capitalization on the Shenzhen Stock Exchange being near 1000 billion yuan ($150 billion), is a key supplier of major global carmakers Tesla, Inc. and Volkswagen AG. CATL has very lately been revealed to be in talks to open plants that would serve BMW AG and Ford Motor Co., and potential sites include South Carolina and Kentucky, where those carmakers have assembly plants. According to sales rankings by the China Automotive Battery Innovation Alliance (CABIA), CATL was China’s top EV battery maker in 2021, followed by BYD and CALB. Changzhou city, Jiangsu province-based CALB is the only non-public one of China’s top five battery companies, with its valuation on private markets listed as over 60 billion yuan ($9 billion).


CATL in July 2021 filed the lawsuit against CALB in the Fuzhou Intermediate People’s Court of Fujian province for the violations of its three invention patents No. 201810696957.2, No. 201810039458.6, and No. 201910295365.4 and two utility model patents No. 201521112402.7 and No. 201520401861.0, seeking 185 million yuan ($28 million) in damages and 3 million yuan ($450,000) in costs. To counter the action brought, CALB petitioned to invalidate some of CATL’s allegedly infringed invention patents and more. An oral hearing about the invalidation bid against one of the allegedly infringed patents No. 201520401861.0 was held on March 10.


According to the rankings of the sales between January and April by the CABIA, CATL remained top spot in market share at 47.4%, down 3% year on year, followed by BYD scoring an increase of 9% in market share. BYD supplies its batteries to its own EVs, which insulates itself from the destined supplier entanglement and renders the head-on fight between CATL and third-ranking CALB, chalking an increased market share of 7.9%, seemingly inexorable. The tug of war between them has been epitomized in the case of Guangzhou Automobile Group Co., Ltd. (GAC Group), for which CATL and CALB were the top two battery suppliers with CATL having been predominating by far before 2017 and the other way around thereafter.


Ironically, CALB has been an early bird in the battery industry. CALB dates back to 2007, when the company was incorporated as AVIC Lithium Technology Co., Ltd. (天空能源(洛阳)有限公司) under Chinese state-owned aerospace and defense conglomerate Aviation Industry Corporation of China, Ltd. (AVIC). It was renamed China Aviation Lithium Electricity Technology Co., Ltd. (中航锂电科技有限公司) in 2015 before being finalized as CALB in 2021 attempting to go public. CALB submitted an IPO prospectus to the Hong Kong Stock Exchange in March. CATL was founded in 2011 and became crowned domestically in 2017. CALB found its footing in 2018 after years of reported losses and has grown into the seventh-largest battery maker worldwide.