TSMC wins case in trade secret battle with Samsung

Taiwan's high court has ruled in favor of TSMC in its lawsuit against a former employee

Chip maker Taiwan Semiconductor Manufacturing Co. has won a court ruling that will prohibit a former employee from leaking trade secrets to rivals, including Samsung.

On Monday, Taiwan's Supreme Court ruled in favor of TSMC in its lawsuit against Liang Mong-song, an executive who left the company back in 2009, and allegedly gave trade secrets to Samsung.

Liang cannot offer his services to Samsung before the end of the year, and must refrain from leaking any trade secrets related to TSMC's chip technology, a court spokesman said on Wednesday.

Both Samsung and TSMC declined to comment on the case, but the two companies are major rivals in the mobile chip making industry. TSMC and Samsung, for instance, are both chip suppliers for Apple's iPhone, and often compete for orders from their various customers.

Former TSMC executive Liang, however, has been accused of leaking trade secrets to Samsung, giving the Korean company an edge in its chip making. In response, TSMC has been waging a legal battle against Liang since 2011.

Liang's lawyer, Wellington Ku, did not respond to a request for comment, but in an interview with a Taiwanese news channel, Ku said restricting his client from working at a rival company would generate controversy as his non-compete agreement had already expired.

As for TSMC, the company is continually updating its chip technology to remain competitive. But analysts have expressed worries that the company is losing chip orders to Samsung's own manufacturing technology.

The rivalry between Taiwan's and South Korea's electronics industry has intensified over the years. Some Taiwanese companies have struggled with sluggish demand for PCs. In contrast, Samsung has risen to become the top producer of smartphones. Tech executives in Taiwan now joke that South Korea is their enemy.

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Michael Kan

IDG News Service
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