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At all times during the manufacture of the video games in
Puerto Rico, EAPR owned all materials and components, work in
process inventory, and finished products relating to the video
games that EA bought.
EA bought from EAPR the video games in dispute in the
instant cases. EAPR was not a sham corporation.
C. Manufacturing Process
Video games were manufactured in the leased space covered by
the Lease, that is, the leased portion of the facilities owned by
PPI in Santa Isabel. The following general steps were used in
manufacturing these video games: The raw materials and
components necessary for a production run were procured from the
warehouse space covered by the Lease and placed in the production
area as needed. The leads on various components for each video
game (including capacitors, resistors, and integrated circuits)
were formed (i.e., bent and cut, as required) using various types
of formers. The formed components were then supplied to a “push-
along” assembly line in which they were inserted, along with ROM
chips and any batteries or other required components, into bare
printed circuit boards.
The circuit boards with the inserted items4 were then placed
on the automatic conveyer in a wave solder machine, where flux
4We assume that that is what the parties mean by their
stipulated--but undefined--term “populated boards”.
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Last modified: May 25, 2011