Toshiba Corp. has missed its self-imposed deadline to sell off its memory business, which was supposed to take place before its annual shareholder meeting, and now Toshiba has filed a $1 billion lawsuit against Western Digital Corp. for its role in delaying the deal.

Western Digital has objected to Toshiba’s attempts to sell its memory business since the sale was first announced at the beginning of this year. According to Western Digital, the memory segment includes several joint venture agreements with its subsidiary, Sandisk, and the company said that Toshiba cannot sell that segment to a third party without permission.

Over the last few months, Western Digital made several attempts to block the deal, and it even filed for an injunction with a U.S. court against Toshiba, with a ruling expected on July 14. Last week, Toshiba chose a consortium of investors as its preferred bidder for the deal, but earlier this week, Western Digital Chief Executive Stephen Milligan rejected Toshiba’s decision, saying that Western Digital “will not consent to a transaction with the proposed consortium.” Milligan also said that the current situation with Toshiba “would make further litigation inevitable.”

On Friday, Toshiba Chief Executive Satoshi Tsunakawa said that he was open to talks with Western Digital, but Toshiba would not make the first move. That seems to have changed now, however, as Toshiba has filed a $1 billion lawsuit against Western Digital, accusing the American company of “acts of unfair competition.” Toshiba said in a statement that Western Digital had “exaggerated its consent right” to interfere with the sale.

Toshiba also denied the claim that it blocked Western Digital from accessing information relating to the joint venture because it assumed that Western Digital would be entering into a contract for that access. With that no longer being the case, Toshiba said that it “has no choice but to block WD’s ability to access such information, starting today.”

It is not clear which side will eventually win out, but it seems likely that the battle between Toshiba and Western Digital is only just beginning.

Photo: Toshiba