The Supreme Court has ruled that Samsung Engineering's (now Samsung E&A) design and construction technology for semiconductor ultra pure water systems qualifies as advanced technology under the Industrial Technology Protection Act. A former employee indicted for leaking Samsung Engineering's trade secrets ahead of moving to a Chinese semiconductor consulting firm will now face a retrial.
The Supreme Court's Second Division, with Justice Kwon Young-jun as presiding judge, on Wednesday overturned a lower court ruling that had sentenced defendant A to three years in prison on charges including violations of the Act on Prevention of Divulgence and Protection of Industrial Technology, the Unfair Competition Prevention and Trade Secret Protection Act (trade secret disclosure), and occupational breach of trust. The case was remanded to the Seoul Central District Court.
A, who had been in charge of ultra pure water system construction management and client relations at Samsung Engineering, was indicted for leaking company trade secrets including ultra pure water system design drawings and equipment specifications between January and February 2019.
Ultra Pure Water refers to water close to pure form, with impurities such as ions and microorganisms removed down to levels as low as one part per 10 trillion. It is used in various cleaning processes required for semiconductor manufacturing. Samsung Engineering succeeded in building its ultra pure water system by investing more than 30 billion won annually in research and development since 2006.
A took the printouts of relevant materials to his residence and kept them there. Around February 2019, he left Samsung Engineering to move to a Chinese semiconductor consulting firm as its ultra pure water lead, according to the investigation. A also faces charges of handing over trade secrets, including ultra pure water system operation manuals and construction improvement materials, at the request of B, a former Samsung Display employee who had been responsible for ultra pure water system ordering and construction management. B, who received the trade secrets, was also indicted.
The first trial found both defendants guilty of most charges, sentencing A to three years in prison and B to two years in prison with three years of probation. B's sentence was finalized without appeal, and the appellate court rejected appeals from both A and the prosecution.
However, both the first and second trials ruled that it was difficult to view Samsung Engineering's ultra pure water system technology as industrial technology designated as "advanced technology" under the Industrial Technology Protection Act. The courts reasoned that the "optimal design technology for high-efficiency RO systems" listed in the Ministry of Trade, Industry and Energy's notice on the scope of advanced technologies and products at the time referred to technology in the seawater desalination field, whereas the technology in this case was in the process water field, which treats industrial water to produce ultra pure water for semiconductors.
The Supreme Court reached a different conclusion. The court ruled that the lower courts had misapplied legal principles when they determined that the ultra pure water system design and construction technology did not qualify as advanced technology under the Industrial Technology Protection Act. It found that "freshwater," classified as a mid-level category under the notice at the time, encompassed not only freshwater as used in seawater desalination but also cases in which the source water itself is freshwater. Considering the legislative purposes of the Industrial Development Act and the Industrial Technology Protection Act, the general meanings of "freshwater" and "desalination," the differences in classification systems between the notice and the industrial technology roadmap, and the value-creation potential of the technology in this case, the Supreme Court said it was difficult to accept the lower court's judgment. "We have confirmed that non-chemical ultra pure water system design and construction technology for semiconductor manufacturing can qualify as advanced technology," the court said.
