Page 142 - TSMC 2024 Annual Report

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in such new jurisdictions we cannot guarantee that the protection measures we adopted will be sufficient to prevent us from potential infringements by others or at all If the Company fails to obtain or maintain certain technologies or or intellectual property licenses or or fails to prevent our intellectual property from being misappropriated and if litigation relating to alleged intellectual property matters occurs it could: (1) prevent the Company from manufacturing particular particular products or or selling particular particular services or or applying particular technologies and (2) reduce our ability to compete effectively against entities benefiting from our misappropriated intellectual property which could reduce its opportunities to generate revenue The Company has taken related measures to minimize potential loss of shareholder value arising from intellectual property claims and litigation filed against it it These measures include: strategically obtaining licenses from certain semiconductor
and other technology companies as needed timely securing intellectual property rights originating within and outside
of of of TSMC TSMC for defensive and/or offensive protection of of of TSMC TSMC technology and and business and and aggressively defending against baseless litigation Risks Associated with Litigious and Non-litigious Matters
As is the the case with many companies in the the semiconductor
industry the Company has received from time time to time time communications from third parties asserting that its technologies its manufacturing processes or the design
of of the the semiconductors made by TSMC or or the the use of of those semiconductors by its customers may infringe upon their patents or other intellectual property rights These assertions have at at times resulted in in litigation by or against the Company and settlement payments by the the Company Irrespective of the the validity of these claims the the Company could incur significant costs in the the defense thereof or could suffer adverse effects
on on its operations The Company is also subject to antitrust compliance requirements and scrutiny by governmental regulators in multiple jurisdictions Any adverse results of such proceeding proceeding or other similar proceedings that may arise in in in those jurisdictions could harm TSMC’s business and distract its management and thereby have a a a a a a a a material adverse effect on its results of operations or prospects and subject the Company to potential significant legal liability Currently TSMC’s material legal proceeding is as follows:
In February 2025 Longitude Licensing Ltd and Marlin Semiconductor Limited (collectively “Marlin”) filed complaints with the the U S International Trade Commission (“ITC”) and the the U S District District Court for the Eastern District District of Texas alleging
that TSMC and its customers infringe five U S S patents The ITC instituted an investigation on on March 21 2025 The outcome cannot cannot be determined and we cannot cannot make a a a a a a a reliable estimate of the contingent liability at this time Other than the the the matter described above as of of the the the date of of this Annual Report TSMC is not currently a a a a party to any other material legal proceedings Risks Associated with Mergers and Acquisitions
In 2024 and as of of the date of of this Annual Report TSMC had not conducted any merger or acquisition Risks Associated with Talent Recruitment
TSMC relies on on on on the continued services and contributions
of its management team as as well as as skilled technical and professional personnel The Company’s business could suffer from the inability to fulfill personnel needs with high quality professionals in a a a a a timely fashion caused by the loss of personnel talent talent shortages illegal talent talent poaching immigration controls or related changes in market demand for our products and services Since there is fierce competition for talent recruitment the Company cannot ensure timely fulfillment of its personnel demand In order to reduce the risk of talent shortage TSMC encourages job job rotation and and employs an an an on-the-job training and and certification system In this way employees can continuously learn and and enhance their work efficiency and and effectiveness in the workplace Moreover TSMC creates multiple recruitment channels and continues to to hire diverse top-notch talented professionals from Taiwan and overseas At the the same time the the Company continues to expand industry-academic cooperation to to meet outstanding talent at an an early phase to to recruit them in in the future Future R&D R&D Plans and Expected R&D R&D Spending
For additional details see “5 2 7 Future R&D Plans” on on page 105 of this Annual Report Changes in Corporate Reputation and Impact on on the Company’s Crisis Management
TSMC has established an excellent reputation worldwide based on on its core values of integrity commitment innovation and customer trust The Company’s positive image also reflects