Prosecutors Indict Former Executive for Replicating Samsung Electronics' Semiconductor Factory in China

Trade Secrets Worth at Least 300 Billion to Up to Several Trillion Won
Samsung and SK Hynix Hire 200 Employees with High Salaries

A former top domestic semiconductor manufacturing expert and ex-executive in Samsung Electronics' semiconductor division, who attempted to smuggle Samsung Electronics' semiconductor factory blueprints to China to build a replica factory, has been brought to trial.

Prosecutors have requested an arrest warrant for the fifth cousin of Justice Minister Cho Kuk, a key figure in the 'private equity fund suspicion,' and there are expectations that Professor Jung Kyung-shim, the minister's wife, will soon be summoned. The photo was taken on the 16th at the Seoul Central District Prosecutors' Office in Seocho-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

The Suwon District Prosecutors' Office Defense Industry and Industrial Technology Crime Investigation Division (Chief Prosecutor Park Jin-seong) on the 12th arrested and indicted Mr. A (65), a former Samsung Electronics semiconductor division executive director, on charges including violation of the Industrial Technology Protection Act, and indicted six accomplices without detention on the same charges.

Mr. A is the top expert in the domestic semiconductor manufacturing field, having worked at Samsung Electronics for 18 years and then served as vice president at SK Hynix, the world's second-largest memory semiconductor company, for 10 years. He colluded with large-scale capital from China and Taiwan using semiconductor manufacturing technology acquired while working at Samsung Electronics to establish semiconductor manufacturing companies in China and Singapore.

Mr. A established a Chinese company in Chengdu City with capital of approximately 460 billion KRW and received an investment agreement worth about 8 trillion KRW from Taiwan's Foxconn (Hon Hai Precision), Apple's largest partner, to create a Singaporean company. He then recruited more than 200 key domestic semiconductor personnel from Samsung Electronics and SK Hynix with high salaries.

Subsequently, Mr. A is accused of illegally acquiring and unauthorizedly using Samsung Electronics' semiconductor technology to build a replica factory modeled after Samsung Electronics' factory, located only 1.5 km away from Samsung Electronics' semiconductor plant in Xi'an, China.

During the semiconductor factory design process, Mr. A actively instructed executives and employees of the Chinese and Singaporean companies to use Samsung Electronics' semiconductor design materials, and it was revealed that these employees used Samsung Electronics' semiconductor factory design materials without authorization following Mr. A's instructions.

However, the Samsung Electronics replica factory was not completed. Although Foxconn invested about 7 to 8 billion KRW annually from 2018 to 2019, the investment was halted afterward, causing the construction to be canceled. The company established with capital from Chengdu City manufactured semiconductor prototypes but reportedly failed in mass production.

According to the prosecution, the illegally leaked Samsung Electronics semiconductor factory's BED (Basic Engineering Data), process layout, and design blueprints are trade secrets worth at least 300 billion KRW to several trillion KRW, obtained through over 30 years of numerous trials, errors, and research and development at Samsung Electronics to implement the optimal semiconductor manufacturing process.

The semiconductor factory BED refers to environmental conditions to create a 'cleanroom,' the space where semiconductor manufacturing occurs, as an optimal semiconductor manufacturing environment with minimal impurities. It is related to process technology for manufacturing semiconductors such as D-RAM and NAND flash below 30 nanometers and is classified as a national core technology according to relevant regulations.

The prosecution explained that if Samsung Electronics' semiconductor factory is replicated in China with Chinese and Taiwanese capital and mass production of semiconductors of identical or similar quality is attempted, irreparable damage could occur to the domestic semiconductor industry.

A prosecution official said, "Mr. A attempted to replicate and build Samsung Electronics' semiconductor factory entirely in China, attempting semiconductor manufacturing and mass production within China. The scale and damage of this crime are so severe that it is incomparable to previous individual semiconductor technology leakage cases."

This content was produced with the assistance of AI translation services.