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Week In Review: Manufacturing, Test

Micron-UMC-JHICC legal battle expands; chiplets; ASIC spinoff.

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Chipmakers
A U.S. federal grand jury has indicted Chinese DRAM maker Jinhua Integrated Circuit Co. (JHICC), Taiwan’s UMC and three individuals, charging them with alleged crimes related to a conspiracy to steal, convey, and possess stolen trade secrets from Micron Technology for the benefit of a company controlled by the China government.

In addition, the U.S. filed a civil lawsuit seeking to enjoin the further transfer of stolen trade secrets and to enjoin certain defendants from exporting to the United States any products manufactured by UMC and JHICC that were created using the trade secrets at issue. The indictment was filed on Sept. 27.

UMC issued a statement, dismissing the allegations.

This week’s announcement follows a long and complex legal battle that involves Micron, JHICC and UMC.

In 2016, JHICC broke ground on a 300mm fab in Jinjiang City in the Fujian province in southern China, at a cost of $5.65 billion. JHICC’s investors include Fujian Electronics & Information and Jinjiang Energy Investment.

JHICC plans to move into production with 22nm specialty DRAMs. It obtained the technology from a licensing/R&D alliance with UMC. UMC isn’t involved with JHICC’s operations.

Last December, Micron Technology filed a suit against JHICC and UMC for alleged theft of Micron’s technology. UMC denied those claims. Then, in January, UMC filed a counter claim against Micron, alleging that Micron infringed upon UMC’s patents.

Then in July, Micron appeared to have suffered a legal setback. UMC announced that the Fuzhou Intermediate People’s Court of the People’s Republic of China (PRC) issued a preliminary injunction against Micron Semiconductor (Xi’an) and Micron Semiconductor (Shanghai), enjoining Micron from offering to sell, and selling in the PRC 26 DRAM and NAND-related items, including certain solid-state hard drives and memory sticks in China.

Micron appears to have struck back. An indictment was filed on Sept. 27. The civil lawsuit was filed on Nov. 1. According to the indictment, the defendants–JHICC, UMC and three individuals–were allegedly engaged in a conspiracy to steal the trade secrets of Micron.

Then, on Oct. 30, the U.S. Department of Commerce moved to restrict exports of equipment and software to JHICC. The Chinese DRAM hopeful “poses a significant risk of becoming involved in activities that are contrary to the national security interests of the United States,” according to the U.S. government agency.

JHICC is nearing the completion of its DRAM fab. “The additional production, in light of the likely U.S.-origin technology, threatens the long-term economic viability of U.S. suppliers of these essential components of U.S. military systems,” according to the U.S. agency. “When a foreign company engages in activity contrary to our national security interests, we will take strong action to protect our national security. Placing Jinhua on the ‘Entity List’ will limit its ability to threaten the supply chain for essential components in our military systems,” Secretary of Commerce Wilbur Ross said in a statement.

The “Entity List” identifies entities reasonably believed to be involved, or to pose a significant risk of being or becoming involved, in activities contrary to the national security or foreign policy interests of the United States.

As a result, UMC this week decided to halt activities with JHICC. “Due to the uncertainty surrounding the situation, we decided to temporarily suspend the R&D activities we were doing for Fujian Jinhua,” according to a spokesman for UMC.

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Netronome has announced an open architecture for chiplets in the area of domain-specific accelerators. Netronome is collaborating with six companies–Achronix, GlobalFoundries, Kandou, NXP, Sarcina and SiFive–to develop an open architecture and related specifications for developing chiplets. Chiplets promise to reduce silicon development and manufacturing costs.

GlobalFoundries has officially spun-off its ASIC unit and given it a new name. The entity, dubbed Avera Semiconductor, leverage GF’s technology and will provide ASIC offerings on 14nm/12nm and more mature technologies. It will provide customers with capabilities and access to alternate foundry processes at 7nm and beyond.

VeriSilicon has rolled out its Bluetooth Low Energy (BLE) 5.0 RF IP based on GlobalFoundries’ 22nm FD-SOI process.

Samsung has slashed its 2018 capital spending budget by more than a quarter amid a downturn in the memory market, according to a report from Reuters.

Fab tools
KLA-Tencor posted its results for the first quarter of fiscal year 2019, which ended on Sept. 30. It reported GAAP net income of $396 million, or $2.54 per share, on revenues of $1.093 billion.

TEL posted its results for the quarter. Sales were up 33.8%. The company remains upbeat regarding memory, but sees a decline in the foundry segment.

MKS Instruments has acquired Electro Scientific Industries (ESI) for $30.00 per share. The all-cash transaction is valued at approximately $1 billion.

Nanometrics is acquiring 4D Technology, a supplier of interferometric measurement and inspection systems.

Packaging and test
Hitachi Chemical failed to properly test parts used to encapsulate semiconductors, according to a report from Reuters. This is Hitachi’s second compliance failing this year.

ASE Technology Holding reported unaudited net revenues of NT$107,597 million for third quarter, up by 46% year-over-year and up by 27% sequentially.

STATS ChipPAC said net revenues for the three- and nine-month periods ended Sept. 30 were $289.8 million and $896.9 million, a decrease of 3.1% and an increase of 9.1% from $299.1 million and $822.1 million in the three and nine months ended a year ago, respectively.

Advantest posted its results for the quarter. Sales and orders were up for the period.

Test Systems Strategies and Advantest CloudTesting Service, a provider of on-demand testing services, have announced a new software module to convert EDA formats (e.g., VCD, EVCD, WGL, STIL) to the Advantest CTS CX1000 platform. Separately, Advantest has introduced its new V93000 SMU8 parametric tester to meet chipmakers’ process-characterization and monitoring needs for the exacting measurements required on the 28nm to 3nm process nodes and beyond.

Market research
The semiconductor market is expected to enter a period of cyclical “cooling” after an extended period of strong growth, according to IC Insights. “The first half of 2018 started out with strong quarterly year-over-year growth for the IC market. However, 3Q year-over-year IC market growth dropped to 14%. Moreover, with the softening of the memory market, IC Insights projects that year-over-year IC market growth in 4Q will be only 6%,” according to the firm.



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