ITC Issues Final Determination in Favor of Power Integrations

August 15, 2006

SAN JOSE, Calif.--(BUSINESS WIRE)--Aug. 15, 2006--Power Integrations, Inc.:

-- Commission Issues Exclusion Order against System General Chips and Downstream Products

-- 38-Cent Bond on Imported Chips Effective Immediately

-- Company Seeking Injunction against Additional SG Products in Ongoing District Court Case

Power Integrations, the leader in high-voltage analog integrated circuits for power conversion, today announced that the International Trade Commission (ITC) has issued its final determination in the company's patent-infringement case against System General Corp. (SG). The ITC has confirmed the administrative law judge's determination that certain of SG's power-supply controllers infringe Power Integrations U.S. Patent Nos. 6,351,398 and 6,538,908, and that SG is therefore in violation of section 337 of the Tariff Act of 1930.

The ITC has also issued an exclusion order against SG's infringing products, which include the SG6840, SG6841, SG6841x3, SG6842, SG6842J and SG6843. The exclusion order prohibits the importation of these parts into the U.S., as well as the importation of any LCD monitors and AC printer adapters containing the infringing parts. The exclusion order is expected to become effective upon the close of the 60-day Presidential review period, which begins immediately. During the review period, any importer of an infringing SG chip must pay a bond of 38 cents for each imported infringing chip or each imported product containing an infringing chip.

"Intellectual property is the lifeblood of our business, and we are determined to protect it against unlawful infringement by competitors," said Balu Balakrishnan, president and CEO of Power Integrations. "By ordering the exclusion of SG's infringing parts from the U.S. market, the ITC has struck a decisive blow in favor of fair competition."

Power Integrations is proceeding with its patent-infringement lawsuit against SG in Federal District Court in San Francisco, originally filed in June 2004. In that lawsuit, which was stayed pending the final decision of the ITC, the company seeks an injunction against all SG products that infringe Power Integrations patents, including the SG 6848 and SG 6849 products, and other, newer parts not subject to the ITC decision. Power Integrations is also seeking financial damages in the district court case.

About Power Integrations

Power Integrations, Inc. is the leading supplier of high-voltage analog integrated circuits used in power conversion. The company's breakthrough technology enables compact, energy-efficient power supplies in a wide range of electronic products, in both AC-DC and DC-DC applications. The company's EcoSmart® energy-efficiency technology, which dramatically reduces energy waste, has saved consumers and businesses around the world more than an estimated $1.7 billion on their electricity bills since its introduction in 1998. For more information, visit the company's website at www.powerint.com. To receive Power Integrations news releases via e-mail, register at http://www.b2i.us/irpass.asp?BzID=1306&to=ea&s=0

Note Regarding Forward-Looking Statements

This press release contains forward-looking statements reflecting management's current expectations regarding the outcome of its ITC action against System General. These forward-looking statements are based on current information that is, by its nature, subject to rapid and even abrupt changes. Forward-looking statements are denoted by the use of such words and phrases as "is expected to" and similar words and phrases that look toward future events or performance. The company's actual results could differ materially from those projected or implied in its forward-looking statements due to risks and uncertainties associated with the company's business. These risks and uncertainties include, but are not limited to, the fact that the ITC ruling is subject to Presidential review, which could result in the ITC ruling being overturned or modified adversely to the company. Also, there is no assurance that any amount of damages, whether placed in bond or otherwise, will be paid to the company. Further, given the inherent uncertainty of litigation, there is no assurance that the company will be successful in the ongoing patent litigation, or that the ITC will have any favorable impact on such litigation. These and other risk factors are more fully discussed in the company's most recent report on Forms 10-K and 10-Q filed with the Securities and Exchange Commission. The company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

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Contact Us

Joe Shiffler
Director, Investor Relations & Corporate Communications
(408) 414-8528
joe@power.com

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Mailing Address:
Power Integrations
Attn: Investor Relations
5245 Hellyer Avenue San Jose, CA. 95138

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P.O. Box 30170
College Station, TX 77842
Phone: (781) 575-2879




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