Asus 2014 Annual Report Download - page 124

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(IX) The risk faced by procurements and sales hub and the responsive measures:
The company’s procurements and sales are not centralized and with a good customer
relationship established; therefore, no risk of procurements and sales centralization.
(X) The impact of massive stock transfer or change by directors, supervisors, and
shareholders with over 10% shareholding, the risk, and the responsive measures:
There was not any massive stock transfer or change by directors, supervisors, and
shareholders with over 10% shareholding in 2013 and up to the date of the annual
report printed.
(XI) The impact of right to operate change on the company, the risk, and the responsive
measures: Not Applicable
(XII) Legal and non-legal events:
1. The company’s major legal issues, non-legal issues, or administrative lawsuits
settled or in pending:
(1) Several patentees filed lawsuits or investigations for patent infringement
including LAN chip, PCI-Express switch, the patent of Blu-Ray, Bluetooth,
thermal management method and device, Display, Bluetooth HS technology,
notebooks, Eee PC, products of Wireless LAN, products of Wireless
telecommunication, equipments with Android system, LTE function,
multi-core ARM processor products, Google Chrome, products with the
image resizing and scanning format conversion, GaN LED products, DVD
player subtitle, audio program player including a dynamic program selection
controllers, products with UMTS network devices, Google Map, standards of
data transmission on modem and standards of wireless telecommunication
against the Group. These lawsuits or investigations are currently under
investigation in a California court, in a Texas court, in a Delaware court, in a
Florida court, in a Massachusetts court, in an India court, in a Spain court and
in a Germany court. The Group cannot presently determine the ultimate
outcome of these lawsuits, but has already recognized the possible loss in the
financial statements.
(2) Several patentees filed lawsuits or investigations for patent infringement
including interactive video system, communication switch technique, Tablet
PC with user-selectable log in and unlock function, products of display
technology, Padfone series products, NOR Flash and XtraROM chip products,
communication or receiving images through delivering the internet, e-sports
mouse, products with memory and access function, LEDs contained in Pad,
write-once Blu-Ray disc, automatic overclocking technology CPU, DVD
player restriction technology, product and/or services for online gaming,
Nvidia processor and visual voicemail against the Group. These lawsuits or
investigations are currently under investigation in a Texas court, in a
California court, in a Delaware court, in a Germany court, in a Shanghai court,
in Korea court and International Trade Commission. The Group cannot
presently determine the ultimate outcome and effect of these lawsuits.
(3) A plaintiff filed a criminal suit against the subsidiary, ASMEDIA, and a
supplementary civil action against the Company and its subsidiary,
ASMEDIA, for infringement of patents. The Company and its subsidiary,
ASMEDIA, have appointed the attorney to deal with the cases through the
legal process and go through subsequent related matters. The lawsuit is
currently under examination in Taiwan Taipei District Court. The plaintiff
also filed a lawsuit for patent infringement, trade secret misappropriation and
unfair competition against the Company and its subsidiaries, ASMEDIA and