In April 2009, Nanosys sued Nanoco and Sigma-Aldrich in Wisconsin federal court for allegedly infringing three quantum dot patents owned by MIT which were exclusively licensed to Nanosys. Nanoco purportedly marketed and sold competing luminous quantum dot nanocrystals under its Lumnidot brand through its U.S. distributor Sigma-Aldrich. The suit was brought in Wisconsin because that was where the products allegedly infringing the patents were sold.
In the complaint initiating the lawsuit, Nanosys explained that its "technology is covered by a portfolio of over 500 patents and patent applications, including patents in the quantum dot field, that is currently being applied to opportunities in multiple industries including energy, electronics, optoelectronics, life science, and defense. Current application areas of Nanosys technology include flat-panel displays, non-volatile memory, fuel cells, solid-state lighting, chemical analysis chips and medical devices."
The lawsuit was resolved prior to any substantive defense. In June 2009, the parties told the Court that the case had been settled and that they were drafting the final settlement documentation. In July 2009, Nanosys voluntarily dismissed the case with prejudice as to both defendants — as to any prior act, or infringement by selling quantum dot nanocrystals having a CdSe/Zns core-shell structure.
According to a Nanoco press release, the parties settled the case without an admission of liability by Nanoco or Sigma-Aldrich. However, as part of the settlement, Nanoco agreed to terminate its U.S. business for heavy metal quantum dots. Nanoco’s CEO explained the cost of defending the litigation was unwarranted by the amount of business generated by the product. He further stated that the company would continue to market its quantum dot products based on heavy metal-free technology, differing from the technology involved in the lawsuit.