SHANGHAI (Reuters) – Shares of Apple Inc.’s Luxshare Precision Industry Co Ltd fell to 9.5% on Monday amid new concerns over a U.S. patent infringement investigation.
On Sunday, in a stock exchange, the company said it was informed of two notifications issued by the United States International Trade Commission (USITC) regarding a section 337 investigation filed against it by Amphenol Corp of the USA, accusing the IP of infringing.
Luxshare said it had hired a team of lawyers to respond and would “follow the procedure” of the investigation without elaborating, but reiterated that the case “will not have a material impact” on its current operations and production.
Amphenol filed a section 337 lawsuit against Luxshare and its subsidiaries in December, alleging that certain electrical components imported into the United States from Luxshare infringe Amphenol’s patents for connecting cables.
A few days later, Luxshare issued a statement saying it had learned of the complaint through the USITC website and added that it had set up an internal working group to investigate the claims.
Founded in 2004, Luxshare has become a fast-growing supplier to Apple in recent years. The value chain of the hardware giant has constantly grown, from the realization of connection cables for iPhone and Macbook to the manufacture of Airpods.
Last year, the company acquired two iPhone assembly plants from Wistron Corp. in Taiwan.
This move has upset some executives at Foxconn, the dominant maker of phones, and is seen by analysts as a sign of several indigenous Chinese companies entering Apple’s supply chain.
Reporting by Josh Horwitz; edited by Richard Pullin