Samsung DRAM Secrets Leak, Taiwan Spy Case Shaping Up

Nineteen Korean engineers were indicted in February for allegedly stealing technology from Samsung and LG Semicon and selling them to Taiwan's Nanya Technology Corp., a subsidiary of the Formosa Plastics conglomerate.

One of the named key figures, Kim Hyong-ik, set up Korea Semiconductor Technology and Dream of Engineers' Technology Co. in Seoul during 1997. The Korean authorities allege that he and his cohorts lured away key Samsung and LG Semiconductor engineers with bribes and high salaries.

The information delivered by the recruits was delivered to Nanya Technology of Taiwan, a maker of computer chips and LCD displays. What was allegedly delivered were 64M-bit DRAM design and process know-how. Reportedly Nanya paid $100K per month for the service.

How was this case blown wide open? A taxi driver carrying the Koreans overheard them talking of selling secrets to a Taiwanese company. The driver reported the what he heard to the authorities.

Samsung and LG Semicon estimated their damages at close to $1 billion -- saying their sales will drop because of the increased competitiveness of Taiwanese DRAM makers.

The Koreans, though, do not have clean hands either. We heard of stories of Korean DRAM makers who secretly hired Japanese DRAM designers some years ago and had them working and designing in Korea over the weekends to get them up and running in the world DRAM business. These illicit weekend commuters helped Korea build up its DRAM prowess quickly at the expense of their Japanese employers.


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