Source: Bronco Finance

Trina Solar and Canadian Solar sued each other for patent infringement.

The photovoltaic patent war has resurged, and two more leaders have gone to court.

Trina Solar, who has just been succeeded by the beautiful chairman, (688599. SH), and Canadian Solar, known as the "Iron Man" of photovoltaics, 688472. SH) has started a patent war!

Recently, Trina Solar accused Canadian Solar and its subsidiaries of infringing its two patents of "solar module" and "solar cell and its manufacturing method", and filed a lawsuit with the Jiangsu High Court, demanding compensation of 1.058 billion yuan.

The amount of litigation in this case is the highest in the litigation of a domestic photovoltaic company. Subsequently, Canadian Solar responded that the allegations lacked factual and legal basis, and said that it had filed a request for invalidation of the two patents with the National Patent Office. The competition between the two sides is heating up.

At the beginning of 2025, the industry is fierce, and giants are involved in the patent war. In the first month of the new year, JinkoSolar (688223. SH) filed a lawsuit against LONGi Green Energy (601012. SH) and now, Trina and Canadian Solar are suing each other for patent infringement. Why are patent wars intensifying? What is the signal behind it?

Trina Solar claimed $1.058 billion from Canadian Solar

Pointing to TOPCon technology

According to the announcement on February 11, Trina Solar requested the court to order Canadian Solar and its subsidiary, Changshu Canadian Solar Technology Co., Ltd., to jointly compensate RMB 1.058 billion for the losses caused by the infringement of the two invention patents, and to bear the reasonable expenses and litigation costs involved in the case.

Trina Solar alleges infringement of two invention patents for the photovoltaic module products manufactured and sold by Canadian Solar: Patent 1 (ZL201710975923.2) for "solar cell modules" with a claim amount of RMB 607 million, and Patent 2 (ZL201510892086.8) for "solar cells and their manufacturing methods" (i.e. TOPCon cell technology) for RMB 451 million.

Source: Canned Gallery

TOPCon (Tunneling Oxide Passivation Contact) is a tunneling oxide passivation contact solar cell technology based on the selective carrier principle, which has become the focus of attention in the photovoltaic industry due to its high efficiency and good compatibility. With the continuous development of photovoltaic technology, TOPCon technology has gradually matured and has become an innovation hotspot in the photovoltaic industry in recent years.

Trina Solar demanded that Canadian Solar immediately cease the infringement, destroy the inventory and special equipment, and bear 2 million yuan of reasonable rights protection expenses and litigation costs. At present, the Jiangsu Provincial High Court has filed the two cases, but has not yet set a trial time.

Trina Solar has publicly stated: "Whether there is infringement can be judged by photovoltaic cell manufacturing technology." As for the amount of profits realized by Canadian Solar's patent infringement, the legal department is calculating. ”

However, Canadian Solar also pushed back at the allegations. On February 11, Canadian Solar said that it had done a thorough research and analysis of Trina Solar's two patents in question, and believed that there was strong evidence to prove that the two patents should be invalid, and the company's products and processes did not infringe the two patents. "Trina Solar's claims against the company and Changshu Canadian Solar totaling more than RMB 1 billion based on the two patents lack factual and legal basis."

Canadian Solar said that in August 2024, Changshu Canadian Solar formally submitted a request for invalidation of the "solar module" patent to the National Patent Office of China. The request is currently pending.

Regarding the details of the patented TOPCon battery technology, Canadian Solar mentioned that the US patent family corresponding to this patent, India's Adani and China's Jiangsu Runyang New Energy Technology Co., Ltd., both of which belong to the defendants, have also filed patent invalidation applications with the United States Patent and Trademark Office (USPTO).

Canadian Solar also said that Trina Solar did not sue in court after applying for customs detention in May 2024, but repeatedly publicly claimed that Canadian Solar infringed, affecting the company's goodwill and production and operation. Therefore, in November 2024, Changshu Canadian Solar filed a lawsuit with the Suzhou Intermediate People's Court for confirmation of non-infringement of patent rights, and the court accepted it in December 2024 and fixed the first hearing time.

Why did Trina Solar, one of the module giants, sue Canadian Solar?

You Bin, an intellectual property expert, said that at present, most of the mainstream domestic photovoltaic companies are mass-producing TOPCon cells on a large scale and continuously improving their technological standards. At the same time, whoever has key technology patents will be able to get more initiative in the market. This is also the root cause of patent disputes between Trina Solar and Canadian Solar and other manufacturers.

Trina Solar's patent battle with Canadian Solar

What is the impact of litigation?

This is not the first time Trina Solar has sued its peers over patent issues. In May last year, Trina Solar sued Jiangsu Runyang for patent infringement over TOPcon cell technology. And Trina Solar's war with Canadian Solar has long been a sign of this.

In May 2024, Trina Solar filed an application with Shanghai Yangshan Customs, alleging that Canadian Solar's wholly-owned subsidiary, Changshu Canadian Solar, was suspected of infringing the patent rights of a patent held by Trina Solar, and applied to Customs to detain nine containers of photovoltaic module products exported by Changshu Canadian Solar to Europe.

This opened the way for Trina Solar and Canadian Solar to compete in intellectual property.

On July 12, 2024, the Customs issued a Notice of Release of Detention (Sealing) to release the relevant goods. Trina Solar stated that Canadian Solar was releasing the detained goods because it had paid a security deposit, while Canadian Solar argued that the goods did not infringe the patent rights referred to by Trina Solar.

In October 2024, Trina Solar filed a patent infringement lawsuit against Canadian Solar and its affiliates in the U.S. District Court for the District of Delaware, involving patents for TOPCon photovoltaic technology patent US9722104 and US10230009. On October 23, Trina Solar filed a Section 337 investigation application with the U.S. International Trade Commission (ITC), alleging that Canadian Solar and other companies infringed the above two patents for specific TOPCon solar cells, modules and other products exported, imported and sold in the United States. Two months later, the U.S. International Trade Commission (ITC) officially confirmed Trina Solar's Section 337 investigation against Canadian Solar.

According to the "2024 Global Top 10 PV Module Supplier Rankings" released by PV-Tech, China's top five PV module giants continue to dominate the list, with JinkoSolar ranking first, Trina Solar, JA Solar, LONGi Green Energy, Tongwei (600438. SH) ranked second to fifth, with Canadian Solar in seventh.

Source: Canned Gallery

Both companies are module leaders, what is the impact of each other's pinching?

Trina Solar's lawsuit directly targets Canadian Solar's core products, and in addition to seeking compensation, it also demands that "the two defendants immediately cease infringing the plaintiff's patent 2, including but not limited to: ceasing to manufacture, use, offer to sell, and sell TOPCon cells and photovoltaic module products containing TOPCon cells that infringe patent 2." "It is understood that Canadian Solar's current TOPCon production capacity is 30GW. If the court upholds the claim, it will have a certain impact on Canadian Solar's market layout.

The photovoltaic industry is a long-distance race, and patents are not the best weapon in the industry competition.

Zhang Yi, CEO and chief analyst of iiMedia Consulting, suggested that no one can afford to spend a patent lawsuit no matter who wins or loses in the end. To some extent, patent litigation in the high-tech field can hardly be said to be a win-win situation, and it is often a lose-lose situation. It is suggested that in terms of win-win situation in the industry, peer or upstream and downstream cooperation alliances can be formed to achieve technical cooperation and sharing through patent alliances to reduce the risk of losses caused by patent litigation.

In recent years, the focus of competition in the photovoltaic industry has shifted from capacity expansion and price competition to technology and patent fields. Especially in the era of N-type batteries, high-efficiency technologies such as TOPCon and back contact (BC) are becoming more and more mainstream in the industry. The leading enterprises in the photovoltaic industry have carried out patent layout in core technologies, and do not hesitate to invest heavily to ensure their technological leadership. Regardless of the final outcome, Trina Solar's patent battle against Canadian Solar has triggered a new round of attention to TOPCon patent protection and the industry's patent competition situation.

In view of the photovoltaic patent scuffle, Youbin believes that while the patent war is becoming more and more intense, the industry will eventually reach a trend of cooperation through cross-licensing, patent transfer, etc. For most businesses, an overabundance of litigation fronts will only lead to wasted resources and market chaos. The truly effective approach may be: while strengthening technological innovation and applying for patent protection, enterprises are also actively seeking technical cooperation and licensing transactions with their peers, so that patent barriers can better promote technological progress rather than stifling industrial development.

In this regard, Zhang Yi also believes that it will be a reversal for enterprises. First of all, it is necessary to continue to develop and innovate, no matter how the patent war is fought, the most important thing is to have its own core and independent intellectual property rights. Especially in terms of technical strength, to crush and form barriers. Secondly, in the process of research and development, pay attention to the construction of patent layout and barriers, especially in the global market, patent application protection, improve the patent protection system, reduce the risk of being litigated, and at the same time help to build the threshold height between competitors and competitors.

Who can win the "Most Beautiful Light Second Generation" vs. "Iron Man"?

Among the "second generation of private enterprises" that will attract much attention in 2024, in addition to Zong Fuli, there is also Gao Haichun, the daughter of Gao Jifan, the founder of Trina Solar, who was also crowned "the second generation of the most beautiful light" by the media because of her appearance.

Born in 1993, Haichun Gao graduated from Brown University in the United States and joined Trina Solar in 2017, where he worked in the board office and strategic investment department. In 2022, Trina Solar will fully manage its distributed photovoltaic business. On January 5, 2025, Trina Solar announced the appointment of Gao Haichun as Co-Chairman of the Board and President of the Solutions Business Group. The Solutions Business Group was established to coincide with Trina Solar's transformation.

However, while Gao Haichun is advancing, Trina Solar may suffer its first loss on the market. Trina Solar has announced that it expects a net profit loss of 3.2 billion to 3.8 billion yuan attributable to its parent company in 2024, mainly due to the decline in the profitability of the module business due to the continuous decline in PV module prices.

Canadian Solar (NASDAQ: CSIQ) was founded in 2001 and listed on the NASDAQ in 2006.

In the photovoltaic circle, as the number one person in Canadian Solar, the chairman of Canadian Solar, Qu Xiaohua, is a low-key and pragmatic tycoon. In early May 2019, 55-year-old Qu Xiaohua was injured in a car accident while inspecting Canadian Solar's Ningxia photovoltaic power plant, resulting in high paraplegia. Two years later, with the assistance of an exoskeleton robot, Qu Xiaohua resumed walking. In June 2023, Canadian Solar landed on the Science and Technology Innovation Board, and Qu Xiaohua rang the bell in a wheelchair, and was known as the "Iron Man" of the photovoltaic industry by the outside world.

Source: Leidi.com

In 2023, the year of listing on the Science and Technology Innovation Board, Canadian Solar achieved revenue of 51.31 billion yuan, an increase of 7.94% year-on-year; The net profit attributable to the parent company was 2.903 billion yuan, an increase of 34.61% year-on-year, the best in history.

Canadian Solar has not yet disclosed its performance forecast, but in the first three quarters of 2024, the net profit attributable to the parent company was 1.955 billion yuan, a year-on-year decrease of 31.17%. According to the 2024 semi-annual report, the company's N-type TOPCon cell production capacity reached 30GW, accounting for about 62% of the company's battery production capacity. It can be seen that TOPCon technology has occupied a very important position in Canadian Solar's products.

Source: Canned Gallery

Ma Tianqi, founder of Zhizhuan Beidou Intellectual Property Consulting Co., Ltd., said that in similar lawsuits, the core of determining the final outcome is the strength of the patent portfolio of both parties. Then there are some determinants, such as litigation strategy, evidence preparation, business negotiation skills, etc. In addition, there are also professional responses, such as the plaintiff in the infringement lawsuit should conduct a patent stability analysis in advance to ensure the validity of the patent in the process of exercising rights, and the defendant should do a good job of patent infringement risk investigation in advance and take countermeasures in advance.

According to the financial report, as of June 30, 2024, Canadian Solar has maintained a total of 2,255 major patents in force, including 368 invention patents; Trina Solar has 2,375 patents, including 943 invention patents. In other words, Trina has accelerated the deployment of a large number of TOPCon patents in recent years, and the total number of patents between the two parties is comparable, but Trina's invention patents are dominant.

Ma Tianqi emphasized that in similar patent litigation, in addition to competing for professional ability, the will and determination of both parties involved in the litigation in terms of intellectual property rights are also extremely important. Because it involves a huge amount of money and time, and it involves a lot of energy. "Responding aggressively and preparing for a lawsuit are often the result of a world of difference." The patent stability of authorized inventions is generally relatively high, and the amount of damages involved in patent litigation is generally larger. In this lawsuit, Trina Solar has a large number of invention patents, and it is more likely to use its patent portfolio to "besiege" the opponent's patents in the course of the litigation.

Regarding the litigation battle between the two companies, Zhang Yi believes that Trina Solar still has some advantages, especially for the two core invention patents, such as Taineng battery modules, as well as solar cells and their manufacturing methods, which have a clear direction. In the past, there were also some customs seizures, etc., and they still accumulated certain evidence for the determination and strength of the patent to protect its rights. As a leading photovoltaic company, it has also accumulated a foundation for its contribution to R&D strength and patents. Canadian Solar responded that there is evidence to prove that Trina Solar's two patents are invalid, and it should also provide some technical information, R&D records, etc. to support his view, so comparing the technology market and market originality of the two products may be in a favorable position for Canadian Solar in the lawsuit.

"Half seawater, half flames." In the current photovoltaic industry overcapacity, fierce price war under the background, rapid iteration of technology and intensified market competition, patent protection is more important, which is a normal phenomenon of industry operation and market competition, but also a test of the technological innovation and development driving force of enterprises. What other competitive cases in the PV industry do you know? Are you bullish on the PV industry?