Is Stealing Technology the End of It? Supreme Court of Korea Cracks Down: Sharing Secrets Among Accomplices Adds Another Crime

[Financial News] The Supreme Court of Korea has ruled that when key semiconductor technology is leaked overseas and accomplices exchange trade secrets among themselves, each such act must be treated as a separate crime. The court indicated that the scope of punishable conduct for trade secret infringement should be interpreted broadly.
According to the legal community on the 23rd, a three-judge panel of the Supreme Court of Korea, with Justice Lee Sook-yeon of the Supreme Court of Korea presiding, recently overturned a lower court ruling that had sentenced a former Samsung Electronics employee, identified only by the surname Kim, to six years in prison and a fine of 200 million won for violating the Act on Prevention of Divulgence and Protection of Industrial Technology, among other charges. The case has been sent back to the Seoul High Court. Two accomplices, including a former employee of semiconductor equipment maker Eugene Technology, identified as Bang, who had been sentenced to two years and six months in prison, will also be retried at the Seoul High Court.
Kim, who left Samsung Electronics and later joined China’s ChangXin Memory Technologies (CXMT), and others were indicted in 2024 on charges of leaking core semiconductor technology belonging to Samsung Electronics and its partner company Eugene Technology to China.
They allegedly removed without authorization design drawings for Eugene Technology’s semiconductor deposition equipment and uploaded them to a network-attached storage (NAS) server to use in semiconductor development in China. In the process, they passed trade secrets to one another and explained parts of the technology that some of them did not fully understand.
At the first trial, the court found that by uploading the trade secrets to the NAS server and leaking them overseas, the defendants had "used" the trade secrets and thus violated the Unfair Competition Prevention and Trade Secret Protection Act, which covers overseas disclosure of trade secrets. Kim was sentenced to seven years in prison, and his accomplice Bang received two years and six months.
However, the court held that the act of "disclosing" trade secrets among co-principals was already encompassed within the use of trade secrets. On that basis, it acquitted them of violating the Act on Prevention of Divulgence and Protection of Industrial Technology and of violating the Unfair Competition Prevention and Trade Secret Protection Act through disclosure of trade secrets overseas. The appellate court upheld these first-instance rulings.
The Supreme Court of Korea took a different view. It held that violations of the Unfair Competition Prevention and Trade Secret Protection Act based on disclosure of trade secrets overseas must be treated as separate crimes.
The Supreme Court of Korea noted, "The Unfair Competition Prevention and Trade Secret Protection Act defines the acts of 'acquiring,' 'using,' and 'disclosing to a third party' trade secrets as separate, independent crimes," and added, "It also defines as an independent crime the act of using trade secrets while knowing that such acts have occurred."
Article 18(1) of the Unfair Competition Prevention and Trade Secret Protection Act provides for punishment of acts such as acquiring, using, or disclosing trade secrets to a third party for the purpose of obtaining unfair profits or causing damage to the holder of the trade secrets.
The Supreme Court of Korea stated that disclosure and acquisition of trade secrets among accomplices also constitute separate offenses, and therefore violations of the Unfair Competition Prevention and Trade Secret Protection Act related to the disclosure of trade secrets must be assessed independently.
The Supreme Court of Korea further explained, "The legislative purpose of the Unfair Competition Prevention and Trade Secret Protection Act is to expand the scope of punishable conduct related to trade secret infringement and thereby strengthen the protection of companies’ trade secrets," and criticized the lower court, saying, "When determining whether a violation of Article 18 of the Unfair Competition Prevention and Trade Secret Protection Act has occurred, that purpose must be fully taken into account, but the lower court failed to do so."
The court also ruled that uploading trade secrets to the NAS server by Kim and others constitutes an ideal concurrence of offenses—one act falling under multiple crimes—since it simultaneously violates both the Act on Prevention of Divulgence and Protection of Industrial Technology and the Unfair Competition Prevention and Trade Secret Protection Act. Accordingly, it also overturned the portion of the judgment that had acquitted them of violating the Act on Prevention of Divulgence and Protection of Industrial Technology.

hwlee@fnnews.com Lee Hwan-joo Reporter