Lidar maker Ouster accuses Chinese rival of patent theft

Lidar maker Ouster is suing China’s Hesai Group for patent infringement and wants the U.S. International Trade Commission to investigate the company for illegally importing technology based on five of Ouster’s lidar patents.

Ouster filed its complaint with the USITC against rival lidar maker Hesai and its related entities on Wednesday.

San Francisco-based Ouster also filed a patent infringement lawsuit against Hesai in the U.S. District Court for the District of Delaware, seeking monetary damages and an import ban against the company’s lidars.

“What we’ve filed is a preliminary step, a request with the ITC to consider our case,” Ouster co-founder and CEO Angus Pacala told Automotive News. “Ouster’s goal is to seek a ban of the infringing products in the United States, this is the first step in a series of steps to ultimately reach that goal.”

Ouster wants the commission to issue a limited exclusion order and a cease-and-desist order against Hesai and its related entities to prevent them from importing lidar devices, components, and products allegedly infringing on Ouster’s patents.

“Ouster’s complaint sets forth how, after the market shifted toward Ouster’s digital lidar, Hesai stole Ouster’s revolutionary patented technologies and incorporated them into Hesai’s competing products,” the company said in a statement.

Ouster’s request for a federal jury trial said the company suffered “lost sales, lost profits and lost market share.“

As well as providing sensor products to China’s military, Ouster’s lawyers noted the company boasted of being incorporated in the Cayman Islands, which may protect it from legal action in China, since the country does not recognize and enforce Cayman Island court judgments reciprocally.

Hesai has dealt with patent litigation in the past. Another lidar maker, Velodyne, which merged with Ouster in February, sued Hesai over patents in China, Germany and the U.S. in 2019.

Velodyne settled with Hesai for “millions” in 2020 and ongoing royalties that will be paid through 2030, according to a 2021 U.S. Securities and Exchange Commission filing.

The companies, “entered a long‑term global cross-licensing relationship encompassing a broad range of 360-degree surround-view Lidar sensors,” according to a joint statement issued in 2020.

Hesai did not respond to Automotive News’ request for comment on Ouster’s suit.

“We’ve been really building a case over many years,” Pacala said about Ouster’s suit. “But at this point, what we saw at the beginning of the year was a very brazen set of public information from Hesai at CES.”

Hesai’s March initial public offering, along with the associated filings outlining their business and technology plans, basically mirrored Ouster’s plans, Pacala said.

Pacala declined to disclose the financial impact of Hesai’s alleged patent infringement but broadly noted China’s potential impact on the U.S. automotive technology and mobility sectors.

“This is part of a broader problem that we’ve seen with Chinese technology companies, Chinese lidar companies that are impacting U.S. jobs, U.S. privacy and U.S. security by infringing on technical achievements made by U.S. companies and then redeploying that technology into our critical infrastructure, into our transportation networks and our ports and airports and into the cars that you and I potentially drive,” Pacala said. “And it’s insane it’s being allowed.”