Mitsubishi, GE lawsuit set for Aug. 9 hearing in Little Rock

The next round in a legal battle that could impact operations of the planned $100 million Mitsubishi plant at Chaffee Crossing will occur Aug. 9 in a federal courtroom in Little Rock.

Mitsubishi on May 20 filed a lawsuit in the U.S. District Court for the Western District of Arkansas claiming that General Electric has engaged “a scheme to monopolize the market for variable speed wind turbines in the United States.”

GE filed a 30-page response June 25 asking the court to dismiss or stay the Mitsubishi lawsuit pending ongoing legal action in Texas and ongoing patent proceedings between the two companies.

On July 30, U.S. Federal Judge J. Leon Holmes ordered a hearing on GE’s motion to dismiss or stay. The hearing is scheduled for 1:15 p.m., Aug. 9, in courtroom 4D of the Richard Sheppard Arnold Federal Courthouse in Little Rock.

Holmes is the third federal judge to handle the matter. U.S. Federal Judge Jimm Hendren handed the case to U.S. Federal Judge Harry Barnes on June 28, and the case was reassigned to Holmes on July 26.

Mitsubishi Power Systems Americas (MPSA) announced on Oct. 16 plans to build a $100 million, 200,000-square foot wind turbine manufacturing plant on 90 acres at Fort Chaffee. The plant could employ up to 400 once fully operational. Company officials said construction will start in the fourth quarter of 2010 and be complete by the fourth quarter of 2011. Mitsubishi officials expect full production and 400 jobs in place by the first quarter of 2012.

Mitsubishi officials originally said an unfavorable legal outcome could jeopardize construction of the plant. They have since said the plant will be built, but its becoming fully operational may depend on the court and patent rulings.

In a July 9 response to GEs motion to dismiss or stay the matter, Mitsubishi reiterated its claim that legal delay will result in financial harm. The company noted: “GE’s conduct is preventing competition with every passing day. Since GE began its campaign of sham lawsuits in the Spring of 2008, the cloud of uncertainty created by that litigation has prevented Mitsubishi from selling a single variable speed wind turbine. Government incentives are now rapidly expanding the wind turbine market, but Mitsubishi and others remain handicapped, while GE solidifies the barriers to competition. Absent a quick end to GE’s scheme, its competitors will miss the boom entirely. Mitsubishi must promptly have its day in court.”

The June 25 filing by GE claims Mitsubishi will not be harmed. The response notes: “This is simply wrong because the ITC and Dallas Actions are ahead of this case, with briefing well underway at the Federal Circuit in the ITC Action and with discovery having already begun in the Dallas Action. The validity and/or enforceability of all five patents at issue will be decided in those pending patent cases where Mitsubishi has had, and will continue to have, a full and fair opportunity to challenge these patents. The patent issues, which are prerequisites to bringing this antitrust case, are already in play, and could resolve this dispute. Going forward here just increases the risks of potentially inconsistent results.”

Mitsubishi rejects the GE argument, saying the other ongoing lawsuits are different and that the case filed in Arkansas’ Western District needs to move forward to address the broadest scope of issues.

“Mitsubishi needs a single forum where it can present the whole of GE’s conduct – GE’s use of multiple unenforceable patents, GE’s initiation of multiple baseless suits, GE’s multiple misrepresentations to wind turbine purchasers – and can receive full antitrust relief. That forum is this Court,” noted the Mitsubishi response.

Judge Holmes has three options. He can deny the motion, dismiss the case, or issue a stay. If he denies the motion, the case would continue to track toward a jury trial. Mitsubishi Corporate Counsel Sonia Williams said it could take as long as two years to reach a jury trial.

If Holmes dismisses the case or issues a stay, Williams said Mitsubishi would likely appeal the decision.

“We’re confident in our cause and believe we will prevail in our hearing,” Williams said.