(Yicai) July 10 -- Chinese smartphone giant Xiaomi said it did not infringe a smart electric fan patent of Gree Electric Appliances, but a supplier it invested in did.

Xiaomi helps Dream Maker Zhejiang Technology, which Gree successfully sued, with sales and promotions, but it is not responsible for the supplier’s daily management and operation, a staffer at the Beijing-based handset maker told Yicai today.

Gree said on Weibo yesterday that China’s Supreme People’s Court recently ruled that an electric fan sold by Xiaomi infringed Gree’s patent rights, and the defendant should pay the plaintiff CNY1.9 million (USD261,140) in damages and immediately stop making and selling the product.

In another Weibo post today, Zhuhai-based Gree clarified that the defendant was Dream Maker, a company in which Xiaomi holds an 8 percent stake.

The fan in question, which is part of Xiaomi’s ecosystem, has been pulled from the company’s official stores, but remains available on e-commerce platform JD.com for CNY1,813 (USD249) each.

Xiaomi has expanded its presence in the electric appliance market in recent years, breathing down the neck of many conventional home appliance makers. On June 28, Gree Chairwoman Dong Mingzhu responded to self-media reports that Xiaomi’s air conditioner sales exceeded Gree’s, saying that Xiaomi relies on suppliers and does not own any technology.

Xiaomi was fourth for the number of home appliances it sold in China during the so-called 618 online shopping festival of May 31 to June 18, behind Gree, Haier Group, and Midea Group, according to JD.com’s data. By air-con sales, Xiaomi ranked third after Midea and Gree, the data showed.

Editors: Dou Shicong, Futura Costaglione