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University of California Sues Walmart, Ikea Over LED Bulbs

Susan Decker

(Bloomberg) -- The University of California is looking to halt imports of vintage-style LED light bulbs that are sold at five of the nation’s biggest retailers, including Walmart Inc., Target Corp. and Amazon.com Inc.

The University of California Santa Barbara says the retailers should be paying it royalties from sales of the bulbs. Bed Bath & Beyond Inc. and Ikea of Sweden AB also were named in the complaint filed Tuesday with the U.S. International Trade Commission in Washington and in civil suits in federal court in Los Angeles.

The energy-efficient light bulbs are designed to imitate the iconic look of the ones developed by Thomas A. Edison, who invented the first mass-marketed incandescent bulb. The dangling Edison bulbs, with their old-fashioned look, glowing filaments and sepia tones, are popular at American restaurants and with modern home designers.

Typical LEDs use opaque glass that hide the structure inside the bulb. Researchers at UC Santa Barbara’s Solid State Lighting and Energy Electronics Center said they developed technology that would allow for an exposed filament that disperses light in all directions.

Seth Levy, the Nixon Peabody lawyer representing the university, said the school had approached some of the retailers to seek a license and was rebuffed. The bulbs are all made overseas by a large number of manufacturers, so suing the sellers is more efficient than trying to track them all down.

“These retailers were selected as a cross section of the kinds of places we find these products,” Levy said.

State Assets

While the school wants to have more LED bulbs in use because they save energy and last longer, it’s entitled to compensation for its research and the patents “are the assets of the state of California,” he said.

Target, Amazon and Bed Bath & Beyond officials declined to comment. An official at Ikea’s US unit said she couldn’t imediately comment. Walmart didn’t respond to a request for comment.

The University of California system is the top educational institution getting U.S. patents, with 526 obtained just last year, according to the Intellectual Property Owners Association.

University research is seen as key to innovation in every field, including medicine, agriculture and computerization. The licensing of academic patents to industries contributed $1.7 trillion to the U.S. economy between 1996 and 2017, according to a June study released by a nonprofit representing university technology transfer offices and the trade group for the biotechnology group.

In this case, the university took the unusual step of partnering with a litigating funding firm, Longford Capital, to help cover the school’s legal costs, “so they would not have to divert funds from other academic priorities,” Levy said.

Nobel Prize

While Longford will get a cut of any proceeds from the suits, the bulk goes to the school and the inventors, including UC Santa Barbara Professor Shuji Nakamura, who was co-recipient of the 2014 Nobel Prize in Physics for his discovery of how to coat blue diodes with phosphor to make the light white. It opened the LED market to commercial applications that have transformed modern lighting, including headlamps in cars, streetlights and electronics.

Complaints at the U.S. trade agency typically take 15-18 months once the commission agrees to investigate, far quicker than a district court. Patent owners often use the threat of an import ban to get the other side to the bargaining table.

The global LED Lighting market, including both residential, commercial and industrial uses, reached $45.57 billion last year and is expected to grow at an annual 11.8% rate through 2025, Grand View Research said in a June report. LED lighting is projected to dominate the American lighting market and reduce energy consumption by 40% by 2030, according to the U.S. Energy Department.

(Updates with companies declining to comment)

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, Elizabeth Wasserman

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