LG Electronics and Matsushita Electric Industrial of Japan have reached a compromise over an infringement of plasma display panel (PDP) module patents that has been dragging on for five months.

In a filing to the Financial Supervisory Service, LG Electronics said Monday two flat-panel display makers signed a mutual cross-licensing agreement, settling a patent infringement dispute over PDPs technology since Nov. 1 last year.

The Korean electronics maker said the cross-licensing agreement will involve patents related to PDP modules and technologies involving personal computers and digital versatile discs (DVDs).

LG Electronics said all lawsuits and injunction requests previously filed will be canceled, and PDP imports to Japan that had been stopped for about four months will resume immediately.

In addition, LG and the Osaka-based electronics giant agreed to establish a bilateral business collaboration committee and continue to expand the scope of business cooperation.

The two companies have maintained a collaborative relationship in the air conditioner business since 2001.

According to DisplaySearch data, LG was the world’s top PDP module supplier in the fourth quarter of last year with 23.6 percent market share in terms of revenue, trailed by Samsung SDI with 22.8 percent. Matsushita ranked third with 21.7 percent share.

However, in terms of PDP TV sales, Matsushita is the No. 1 supplier globally, with the two Korean display firms nipping at heel of the Japanese maker.

The tussle between LG and Matsushita is one of a string of legal disputes over panel technology among Korean, Japanese and Taiwanese firms, who are fighting to gain an upper hand in the growing market for flat panel TVs.

After three months of unsuccessful cross-licensing negotiations, Matsushita filed for an injunction with the Tokyo District Court on Nov. 1 last year, calling for a ban on imports of LG’s PDPs. Matsushita alleged that LG Electronics violated its patent rights.

LG and its Japanese rival have been locked in an escalating battle over PDP patents after LG rejected Matsushita’s demand for royalty payments for using its patents on heat radiation technology.

LG Electronics on Nov. 12 countered Matsushita’s move by asking the Korea Trade Commission to ban the sale and import of Matsushita’s PDPs by Panasonic Korea, asserting that the Japanese display maker infringed upon LG’s PDP patent rights. It also filed a patent suit with the Seoul District Court on Nov. 3, calling for a reimbursement of unpaid royalties.

On Nov. 29 last year, the Korean trade authority imposed a total ban on both the import and sale of PDPs made by Matsushita domestically in response to a complaint lodged by LG Electronics.

The tussle has been just one of a number of legal disputes over panel technology among global display manufacturers, especially those in Korea, Japan and Taiwan, underscoring a fierce fight for any advantage in the potentially lucrative market for flat panel TVs.

DisplaySearch expects global PDP market to more than quadruple in size to 12.3 million sets globally by 2008 as consumers trade in bulky cathode-ray tube models for flat screen TVs.