Agilent Technologies, Inc. (A - Free Report) has claimed that its former employees who formed Shanghai Echrom Electronic Technology Co., Ltd., have adopted a not-so-honest way of getting information to replicate an Agilent gas chromatograph.
The leading provider of application focused solutions sued Shanghai Echrom and a number of its former employees alleging intellectual property theft. The suit seeks a ban on the use of Agilent’s proprietary technologies and compensation for its losses.
The company’s senior vice president and general counsel Michael Tang stated, “Agilent is determined to protect our IP, and will take all appropriate legal actions against any infringements worldwide.”
We observe that Agilent shares have rallied 37.8% year to date, outperforming the industry’s gain of 31.6%.
IP and its Protection Matter
Intellectual property (IP) rights and their protection (by law) encourage a company toward better production and commitment to additional resources and enhances consumer confidence against counterfeits. These hold the key to the survival of multibillion dollar firms and give them ways to legally fight competition.
This is all the more important for Agilent as it faces fierce competition from the likes of Veeco Instruments (VECO - Free Report) , Abbott Laboratories (ABT - Free Report) and Thermo Fisher Scientific (TMO - Free Report) .
Agilent Technologies, Inc. Revenue (TTM)
But the Truth is Bitter
At the end of the day, employees do like to switch jobs because it’s more profitable and allows them liberties that aren’t available for sticking around at a big corporate house like Agilent.
In the process, IP also changes hand (illegally). There have been instances of employees leaving companies, forming new ones and getting sued over intellectual property infringement in the past and it may happen in the future too.
So, while Agilent could win this battle, the war will go on.
Agilent has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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