Venerable Japanese electronics firm Sharp Corp. has been synonymous with consumer products innovation for much of its 105-year history, developing the first LCD calculator in 1973 and becoming one of the earliest companies to produce extra-large, high-end flatscreen TVs. But after selling a Mexican factory and licensing its North and South America TV business to Chinese manufacturer Hisense Co., the picture became a lot blurrier — literally.
On Monday, Sharp filed a lawsuit against Hisense in the San Francisco Superior Court alleging the Chinese company willfully manufactured subpar Sharp televisions in an attempt to devalue the brand as a future competitor. The suit also alleges that Hisense misrepresented the actual picture size on several Sharp models, and exaggerated the brightness of one television set by 35 percent in its marketing materials, which harmed consumers who paid money for a certain level of performance, as well as hurting Sharp’s reputation.
In addition, the suit claims the Hisense-manufactured Sharp television sets “emit excess radiation, in violation of FCC standards,” violations which “have harmed and have the potential to create continuing harm to the California public, as well as Sharp’s goodwill and brand equity in its products, including but not limited to televisions.”
Hisense did not immediately respond to TheWrap’s request for comment.
China’s Hisense, a 48-year-old conglomerate that has recently become a significant player in the flatscreen TV market, acquired a Sharp-owned factory in Mexico in 2015 at a time when the Japanese company’s TV business was struggling with an increasingly competitive market, as manufacturers like Samsung, LG and Vizio battled each other on price. As part of the deal to acquire the factory, which primarily produced larger-screen Sharp TVs for sale in North America, Hisense agreed to a five-year licensing agreement to sell Sharp-branded TVs (including its Aquos, Quattron and other trademarks) in North, Central and South America, excluding Brazil. According to the complaint, the licensing deal required Hisense to “maintain the licensed brands in such a way as not to devalue them during the term” of the agreement.
But while the average retail price of televisions in the U.S. declined by less than 10 percent throughout the course of 2016 — and Hisense’s prices remained basically unchanged — Sharp-branded TVs saw their price drop by 40 percent in the 12 months following January 2016, when Hisense first started selling Sharp TVs, the suit claims.
Sharp terminated its licensing agreement with Hisense in an April 17 letter, and the company claims it will suffer “irreparable injury” if Hisense ignores that termination and continues to sell inferior Sharp-branded TVs. Taiwanese company Foxconn acquired a majority stake in Sharp last year.
“If Defendants are permitted to continue to manufacture televisions with the Sharp brand, the trademarks, and all of the goodwill built up in them since as early as 1912, are at risk of being destroyed by the time the five-year term of the [license agreement] expires,” the suit alleges.
Sharp is asking the court for an injunction preventing Hisense from using Sharp’s trademarks, as well as general, special, consequential, exemplary and punitive damages.
11 Coolest Products at CES Asia, From Order-Taking Robots to VR Fishing (Photos)
CES Asia, the three-year-old overseas version of the annual Las Vegas tech extravaganza, took over five halls at the Shanghai New International Expo Center to showcase the latest and greatest in consumer technology -- which included plenty of robots, smart appliances and self-driving cars. A full 450 exhibiting companies and more than 30,000 attendees test drove some products at the bleeding edge of innovation.
Matt Pressberg
Cowarobot autonomous suitcase This is not your typical overnight bag. The rolling suitcase from China’s Cowarobot can identify and follow its owner through airport concourse traffic, avoiding obstacles along the way. It also automatically locks depending on distance from the owner, alerts when it’s more than a safe distance away.
Matt Pressberg
Pico Neo DKS The Pico Neo DKS is a wireless virtual reality rig that plays like a full-fledged PC setup, with a 2.5K 5.5 inch HD screen that smooths out the often-blurry and clunky gameplay of most mobile VR devices. The setup uses Qualcomm’s Snapdragon 820 processor to deliver substantial computing power.
Matt Pressberg
HiScene HiAR Like the Neo DKS, one of CES Asia’s buzziest augmented reality headsets also features the Qualcomm Snapdragon 820 processor. The HiAR goggles, which feel heftier than many other AR sets, use artificial intelligence as part of an always-on voice control capability -- as augmented reality continues to move toward a “Minority Report” future.
Matt Pressberg
Shadow Creator Halomini In case you hadn’t noticed, virtual and augmented reality was kind of a big deal at CES Asia – as it was at the flagship Vegas show earlier this year. Shadow Creator’s Halomini headset, which feels like a lighter version of Microsoft’s HoloLens, allows users to set appointments, chat with friends and watch videos, while keeping their eyes on whatever it was they're watching.
Matt Pressberg
Ovo Technology Danovo CES Asia is full of robots, but the Danovo stood out for its fun personality – as much as that applies to an inanimate object. The egg-shaped machine from China’s Ovo Technology can navigate around items, dance, engage with people, and even project video by sliding over the top of its “shell.” Ovo also makes trash collecting and security robots, but they're a lot more serious than the Danovo.
Matt Pressberg
Gowild Holoera Virtual reality can be lonely, which is why Gowild decided to add a friend. “Amber,” a 3D hologram who lives inside its pyramid-shaped Holoera device, can respond to commands, read moods – and cheer users up with a well-timed song.
Matt Pressberg
Qihan Sanbot Another entry in CES Asia’s parade of robots was Qihan’s Sanbot, which is based on IBM’s "Jeopardy!"-winning Watson operating system. Sanbot can recognize and communicate with customers in 30 languages and process credit card payments. It also does a delightful dance, complete with glowing, gyrating limbs.
Matt Pressberg
Baidu Little Fish The smart speaker from Chinese tech giant Baidu is the country’s answer to the Amazon Echo, only with a high-resolution 8-inch screen and camera that turns to face the user. It can handle the basics like controlling smart-home devices and playing music, and its face-recognition software allows authorized users to order food and medicine.
Matt Pressberg
PowerVision Power Ray The fishing robot includes ocean mapping, an integrated fish luring light and even an optional remote bait drop feature that allows users to place the hook wherever they want. Its camera shoots in 4K UHD and is capable of 1080p real-time streaming. It even connects with the Zeiss VR One Plus VR headset to turn real-life fishing into a virtual reality game.
Matt Pressberg
JD JDrone The unmanned aircraft is part of a plan from China’s second-biggest online retailer, JD.com, to use drones to deliver products that weigh as much as one metric ton. The company is also developing fully-automated warehouses.
Matt Pressberg
Itonology CarMew C1 This lighter socket-mounted device gives cars high-speed wi-fi, allowing people in them (preferably not driving) to get work done and stream music. It connects near field FM, auxiliary dual channels and car audio, and enables sharing of 4G networks.
Matt Pressberg
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The Chinese version of the annual tech extravaganza featured plenty of robots and serious advances in mobile virtual reality
CES Asia, the three-year-old overseas version of the annual Las Vegas tech extravaganza, took over five halls at the Shanghai New International Expo Center to showcase the latest and greatest in consumer technology -- which included plenty of robots, smart appliances and self-driving cars. A full 450 exhibiting companies and more than 30,000 attendees test drove some products at the bleeding edge of innovation.