Asus 2012 Annual Report Download - page 158

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7. COMMITMENTS AND CONTINGENCIES
(1) Lawsuits for infringement of intellectual property rights
A. In May 2007, a US company filed a lawsuit against the Company and its US subsidiary for
patent infringement. In January 2012, the Company was ordered by the court to compensate
the plaintiff, but the Company will appeal to a higher court. In January 2011, the plaintiff, a
US company, also filed a lawsuit against the Company and its US subsidiary for patent
confirmation, and the lawsuit is currently under investigation.
B. Several patentees filed lawsuits or investigations for patent infringement including CD burner
software, Image editor software, LAN chip, PCI-Express switch, WiFi function, the patent of
Blu-ray, DCDi technique, Dynamic voltage scaling function for solid state disk, server of
Wireless AV streaming, DDR, FLASH memory, LCD, Bluetooth, BIOS, Image chip, thermal
management method and device, Display, Bluetooth HS technique, notebooks, Eee PC, and
products of Wireless LAN against the Company. These lawsuits or investigations are currently
under investigation in a California court, in a Texas court, in a Delaware court and in United
States International Trade Commission. The Company cannot presently determine the ultimate
outcome of these lawsuits, but has already recognized the possible loss in the books.
C. Several patentees filed lawsuits or investigations for patent infringement including products
with the image resizing and scanning format conversion, e-mail, location service, digital image
processor, AIO PC, Eee slate, Eee PC, PowerDirector, interactive video system,
communication switch technique, and Tablet PC with user-selectable log in and unlock
function against the Company. These lawsuits or investigations are currently under
investigation in a Texas court, in a California court and in a Florida court. The Company
cannot presently determine the ultimate outcome and effect of these lawsuits.
(2) Lawsuits for consumer rights
In February 2012, consumer F filed a group lawsuit for GPS and WiFi function being interfered
due to the design of Tablet PC case against the Company and its US subsidiary. The lawsuit is
currently being tried in a Northern California court. The Company cannot presently determine the
ultimate outcome and effect of this lawsuit.
(3) To ensure the supply of raw materials, the Company entered into an agreement with a supplier for a
guaranteed quantity of materials supply at a discount to market price or at an agreed price. The
payment was recognized as prepayment of $0 and $150,667 as of December 31, 2012 and 2011,
respectively.
(4) The Company entered into operating lease contracts for its offices and parking spaces. Future lease
payments under those leases are as follows:
459,019$
Year
Amount
2017
63,539
2013
196,276$
2014
2015
72,126
63,539
2016
63,539