WASHINGTON -- South Korea's Kolon Industries Inc. has won a U.S. appeals court decision obliging a lower court to examine DuPont's alleged monopolization of the U.S. market for para-aramid fibers used for high temperature-resisting goods.
"Whether Kolon's proffered relevant geographic market definition will hold up upon a fact-intensive inquiry remains to be seen," the U.S. Court of Appeals for the Fourth Circuit in Richmond, Virginia said in a ruling on March 11, according to Litigation Daily. "But dismissing Kolon's counterclaim on its face was in error."
The appellate court's three-member panel was reversing the decision by the Federal District Court in Richmond in December that dismissed Kolon's accusation that the U.S. chemical giant forced their customers to sign multiyear contracts for the purchase of more than 80 percent of para-aramid fibers from DuPont.
Kolon brought the counterclaims in 2009 when DuPont accused the South Korean textile producer of hiring former DuPont employees to steal the technology and business secrets related to DuPont's Kevlar products, including protective vests, helmets and sporting goods resisting high temperature.
In delivering the ruling, the appeals court said, the lower court relied excessively on DuPont lawyers.
"It would surely have been difficult for Kolon to know whether it had all relevant DuPont contracts given that nothing in the record indicates that full discovery had been undertaken," the appellate court said. "Nevertheless, the district court's anticompetitive conduct analysis is riddled with reliance on DuPont's statement about the contracts."
Kolon claims that DuPont has been obstructing fair competition in trying to block Kolon's access to the para-aramid fiber market which Dupont and Japan's Teijin evenly divides.
The South Korean firm occupied about 4 percent of the market estimated at more than US$3 billion in 2009, industry sources said.
The market is expected to more than double this year.