Seagate Wins $525 Million From Western Digital
While the hard drive shortage continues, Western Digital suffers another loss.
Western Digital has suffered a major hit as rival Seagate Technology wins an arbitration award worth $525 million, pending confidential arbitration action in Minnesota.
Basically, the arbitration award is based upon claims by Seagate against Western Digital and a former Seagate employee. Seagate argues that the said individual allegedly misappropriated confidential information and trade secrets.
Despite the pending award, Western Digital is denying the validity of these claims.
Western Digital president and chief executive officer John Coyne commented in a statement:
We do not believe there is any basis in law or fact for the damage award of the arbitrator. We believe the company acted properly at all times and we will vigorously challenge the award. This does not affect our ability to conduct our operations, to complete the recovery and recommencement of our Thailand operations or, subject to obtaining the required regulatory approvals, to consummate our planned acquisition of Hitachi GST.
Note that the $525 million award amount does not include prejudgment interest, which will be determined later.
Don’t forget that Western Digital must also be reeling considering the flooding in Thailand, which has led to a major hard drive shortage throughout the industry.