Hypertherm Associates received the definitive ruling from China’s Superior Court, securing a significant settlement from Chinese aftermarket consumable manufacturer Changzhou Termmei (TRM) for infringement of two of Hypertherm Associates’ patents. This victory comes after a legal battle spanning five years against TRM, a prominent Chinese consumable manufacturer. The court’s decision mandates TRM compensate Hypertherm for damages resulting from the infringement of the Duramax Electrode and PowerPierce XD shield patents from 2017 to 2019.
Following the discovery of TRM’s infringement of two core Hypertherm Associates patents, the Suzhou IP Court initially granted Hypertherm Associates a modest damages sum. Hypertherm Associates contested this outcome with an appeal, which resulted in a 950% increase over the original damages award. Through this award, Hypertherm Associates was able to reclaim several million RMB (Chinese currency) in profits that TRM gained through its infringing activities. This verdict stands as the largest damages award ever secured by Hypertherm Associates in China.
TRM has been selling Hypertherm plasma patent-infringing aftermarket consumables since 2011. TRM was the largest manufacturer of Hypertherm plasma aftermarket consumables in China, serving as the primary supplier to many trading companies both inside and outside of the country. They are the industry standard for many aftermarket sellers and have a significant influence in the market. Aftermarket sellers were offering patent infringing TRM-made products under a variety of different brand names. Despite numerous patents held by Hypertherm Associates in China and continuous warnings, TRM refused to stop its infringing activities until compelled by a Chinese court.
In 2022, prior to the initial hearing, Hypertherm Associates discovered a critical new piece of evidence where TRM was seeking to go public. As part of its IPO prospectus, TRM included financial details of its businesses, including revenues for its aftermarket consumable sales. Hypertherm Associates’ attorneys submitted this new evidence to the court before the hearing.
Then in 2023, TRM’s IPO application was rejected, as their R&D budget was far below the government requirements with their annual revenue and growth rate being lower than the required standards. Over the course of the two hearings, the court tried to compel the two parties to settle, but it was not possible outside of court because TRM would not agree to cease infringement and refused to pay any damages for years of infringement.
Consequently, in December 2023, the court made its final verdict to award Hypertherm Associates the record sum of damages.
This verdict serves as a clear message to other aftermarket manufacturers that Hypertherm Associates is determined to defend its IP assets around the world and will not tolerate IP violations.
“Hypertherm Associates devotes enormous resources to the development and engineering of technologically advanced cutting systems and consumables,” said Brett Hansen, Director of Intellectual Property. “We decided to pursue these legal actions because we are concerned about our customers and their business. These non-genuine consumables do not include the decades of experience and learning that Hypertherm puts into designing and manufacturing its plasma consumables. We are pleased to see that our efforts, and the resulting patents, are recognized and enforced by the Chinese government.”
Hypertherm Associates is a U.S. based manufacturer of industrial cutting products and software. Its products, including Hypertherm plasma and OMAX waterjet systems, are used by companies around the world to build ships, airplanes, and railcars; construct steel buildings, fabricate heavy equipment, erect wind turbines, and more. In addition to cutting systems, the company creates CNCs and software trusted for performance and reliability that result in increased productivity and profitability for hundreds of thousands of businesses. Founded in 1968, Hypertherm Associates is a 100 percent Associate-owned company, employing approximately 2,000 Associates, with operations and partner representation worldwide.
