Ex-Worker Jailed in TSMC Trade Secrets Case

Court Delivers Verdict in Chip Technology Theft

A Taiwan court has sentenced a former employee of both TSMC and Tokyo Electron to 10 years in prison for unlawfully obtaining trade secrets related to TSMC’s advanced 2-nanometre chip technology. Tokyo Electron's local unit was also fined T$150 million, equivalent to $5 million. Four other individuals received jail terms ranging from 10 months to six years in this high-profile case.

Overview of the National Security Breach

The case involved violations of Taiwan's National Security Act, as the defendants intended to use the stolen trade secrets outside of Taiwan. The information, which pertains to technology critical for maintaining TSMC's global leadership, was discovered on Tokyo Electron's cloud system. Taiwan has classified sub-14 nanometre technologies as critical national core technologies, affording them strict legal protection.

Market and Corporate Response

Following the verdict, TSMC shares closed up 3.7%. The company reiterated its zero-tolerance policy for actions that compromise its trade secrets. Tokyo Electron stated it takes the court’s finding with the utmost seriousness, noting that the investigation found no organizational involvement and that a settlement had been reached with TSMC. The case is reported to have no impact on its financial results.

Case Summary and Outlook

The court's decision underscores Taiwan's commitment to protecting its vital semiconductor industry. While the defendants can appeal the ruling, the case highlights the severe legal consequences of corporate espionage in the tech sector. The fine will be partially paid to TSMC and the state treasury.

FAQ

Q: What specific technology was compromised?
A: The case involved trade secrets related to TSMC's 2-nanometre and A14 process technology, which is among the industry's most advanced.

Q: What were the main penalties issued by the court?
A: Penalties included a 10-year prison sentence for the main defendant, shorter terms for others, and a T$150 million fine for Tokyo Electron's Taiwan unit.

Source: Investing.com