AXTI is still primarily a substrates company.
In blue LEDs, they have an opportunity in substrates if they can develop GaN substrate capability. To my knowledge, such substrates have only been announced from Sumitomo and from Samsung, although Samsung's is actually a "Thick GaN epilayer (300 microns) on Sapphire Substrate."
Sumitomo's single-crystal GaN substrate is conductive. It may also be or become possible to make them insulating, but demand for blue LED production would certainly be for conducting. Judging by their lawsuit filed against one of Cree's distributers in Japan, Nichia believes that their patents apply in either case, that is, devices produced fall within the scope of the patent regardless of this characteristic. Whether or not they do (to be determined), the substrates business is down the food chain from the patent issue.
With respect to patent litigation, there are two schools of thought, two ways to attack from Nichia's perspective. One is to target the big strong fish (Cree), so that if you win, the others will be forced to fall into line. The other is to choose a small weak fish, to maximize your odds of winning the case. If they are already generating a large body of legal work related to Cree, that might sway them to choose that route if and when they take action in the U.S. Obviously, the outcome in Japan will also influence their future course of action.
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