Arbitrator Sides with Seagate, Asks Western Digital to Pay $525 Million

Paul Lilly

Hard drive maker Western Digital announced this morning that on November 18, 2011, an arbitration award of $525 million was rendered against the company by a sole arbitrator in a pending confidential arbitration action in Minnesota brought on by Seagate. Not included in that amount is prejudgement interest, which will be determined and tacked on at a later date.

Specifics of the complaint aren't known, though WD did reveal that the award involves claims brought on by Seagate and a former employee of Seagate, and allege misappropriation of confidential information and trade secrets.

"We do not believe there is any basis in law or fact for the damage award of the arbitrator," said John Coyne , president and chief executive officer of Western Digital. "We believe the company acted properly at all times and we will vigorously challenge the award."

Hard drive makers are still trying to recover from recent flooding in Thailand. Western Digital said this case won't disrupt those efforts, nor will it interfere with the company's planned acquisition of Hitachi GST.

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