Helped Broker Hundreds of Billions Won Contract by Handing Over Samsung Electronics' "Hand"... Prosecution Indicts Multiple Former Employees

Head of American NPE Company, Mr. B
Requested Provision of Samsung Internal Information
Former Samsung Employee Leaked Negotiation Strategies
"30 Million Dollar Patent Deal" Signed
Internal Collusion with Colleague Mr. C Detected

The prosecution has indicted a former Samsung Electronics employee and the head of a patent management company (non-practicing entity, or NPE), among others, on charges of embezzling Samsung Electronics’ core patent confidential information and earning illicit profits amounting to tens of billions of won. An internal Samsung Electronics staff member colluded with an external NPE to leak the company's negotiation strategies, which ultimately led to a patent contract worth 30 million dollars (approximately 44.58 billion won), according to the investigation.

Kyungtaek Park, Chief Prosecutor of the Information Technology Crime Investigation Division at the Seoul Central District Prosecutors' Office, is announcing the investigation results of the Samsung Electronics patent-related confidential information leak case on the 9th at the briefing room of the Seoul High Prosecutors' Office in Seocho-gu, Seoul. Photo by Yonhap News

The IT Crime Investigation Division of the Seoul Central District Prosecutors' Office, led by Chief Prosecutor Kyungtaek Park, announced on the 9th that it has indicted two individuals — a principal engineer at the Samsung Electronics IP Center (referred to as A) and the head of a US-based NPE (referred to as B) — on charges of violating the Unfair Competition Prevention Act (including trade secret leakage) and bribery. Additionally, three more individuals, including a former Samsung Electronics employee (C) and an NPE staff member, as well as one corporate entity, were also indicted without detention for violating the Unfair Competition Prevention Act.

According to the prosecution, A, who was in charge of intellectual property management at Samsung Electronics, is accused of receiving a total of 1 million dollars (about 1.486 billion won) in two installments from B between April and June 2021, in return for providing internal information to facilitate a patent contract with Samsung Electronics. Subsequently, A leaked key confidential documents, such as comprehensive patent analysis reports and negotiation strategies prepared by in-house experts at Samsung Electronics, to B and others on multiple occasions.

B is accused of transferring 1 million dollars to A, receiving Samsung Electronics’ patent analysis materials, and using them in negotiations with Samsung Electronics. The prosecution found that B, based on these materials, concluded a patent contract worth 30 million dollars with Samsung Electronics and subsequently prepared for the company’s stock market listing.

The investigation also uncovered evidence of internal collusion. C, who worked with A at the IP Center, knowingly handed over company confidential information to B. Notably, C was found to have encouraged harm to the company, blatantly stating through an internal messenger, "Demand 5 million dollars from B in exchange, as this is valuable information for the NPE," and "Tell them to offer 25 million dollars to Samsung Electronics." There is also evidence that A secretly established a separate NPE while employed at Samsung Electronics and attempted to use internal data for personal business interests.

The leaked materials consisted of comprehensive analysis and response strategy documents prepared by engineers and patent attorneys at the Samsung Electronics IP Center regarding patents that the NPE claimed had been infringed. The prosecution described these documents as "decisive information comparable to knowing an opponent’s hand in a poker game before betting."

Recently, domestic companies with advanced technologies such as semiconductors — including Samsung, LG, and SK — have increasingly become targets of NPEs, which generate profits solely through patent litigation without producing products. In fact, in 2024, NPE-initiated lawsuits accounted for 80.4% of all patent litigation involving domestic companies in the United States, and Samsung Electronics is reportedly facing litigation in the US at a pace of "once every four days."

This case began with a complaint filed by Samsung Electronics in April of last year. Through email and account tracking, the prosecution confirmed additional instances of bribery and multiple leaks of internal materials, leading to a search and seizure operation. The prosecution stated, "This case confirms and punishes the illegal activities of NPEs that have developed business models centered on misappropriating company information for personal gain," adding, "We will continue to respond firmly to illegal NPE activities that cause fatal losses to corporate survival and the national economy."

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