US Court Rejects All Civil Lawsuits Against Chinese Chip Maker SMIC
Chinese chip maker Semiconductor Manufacturing International Corporation (SMIC) announced on Friday that it had received a ruling from the United States District Court for the Central District of California dismissing, in its entirety, the civil lawsuit as disclosed in the company’s announcement dated December 15, 2020, with prejudice and without leave to amend.
As disclosed in the announcement, the civil lawsuit was brought on behalf of a putative class of persons alleged to have acquired certain securities of SMIC publicly traded on the OTCQX market. The lawsuit alleged that the company had violated several U.S. regulations. In the ruling, the court granted the motion proposed by the company to dismiss the action, in its entirety, and the ruling is subject to appeal by the plaintiffs.
On May 24, 2019, SMIC announced that it would apply for the voluntary delisting of its US ADSs from the New York Stock Exchange. On December 3, 2020, the US Department of Defense added SMIC and other four Chinese enterprises onto its blacklist. Just a week later, the lawsuit appeared in the local court in the US.
SMIC is a leader in the Chinese integrated circuit manufacturing industry. In 2021, its business income in Mainland of China and Hong Kong accounted for 64.0% of its total business income, while North America accounted for 22.3% and Europe and Asia accounted for only 13.7%.
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SMIC’s operating income in 2021 reached 35.631 billion yuan ($5.32 billion), a year-on-year increase of 29.7%, while its net profit was 10.733 billion yuan, a year-on-year increase of 147.7%. In 2022, SMIC’s performance growth was stronger as its first quarter saw the company’s operating income and net profit increase by 62.6% and 175.5% respectively.