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MediaTek to appeal trade secret leak ruling

2011/01/05 13:15:57

Taipei, Jan. 5 (CNA) Taiwan-based IC designer MediaTek Inc. saidWednesday it will appeal a ruling handed down by a district court inTaipei on a trade secret leak case filed by the company against aformer employee.

In a verdict issued Monday, the Taipei District Court sentenced aformer MediaTek employee surnamed Yang to nine months in prison thatcould be commuted to a fine of NT$270,000 (US$9,225) for leakinginformation to a MediaTek competitor.

MediaTek said it would file an appeal because the ruling was toolenient and would encourage further violations of laws protectingtrade secrets in the future, potentially setting off a cycle ofvicious competition within the sector.

Yang was accused by MediaTek of illegally leaking the company'strade secrets to rival MStar Semiconductor Inc. in 2007, when he leftMediaTek to work for MStar.

According to MediaTek, Yang, who was on MediaTek's payrollbetween November 2005 and April 2007 before starting work at MStar inMay 2007, collected MediaTek's confidential business information justbefore he left the company.

After Yang was employed by MStar, he used the secrets containedin his notebook computer on the job and also presented it in abriefing for MStar executives, MediaTek alleged.

Upset by the ruling, the company said confidential businessinformation is an IC designer's most important intangible asset, andif the law could not adequately protect companies' trade secrets andother intellectual property, the sector's survival would bethreatened.

It also argued that the impact of the court decision would be feltnot only by high-tech businesses but also by the domestic economyacross the board.

In a recent report released by IC Insights, MStar was expected torank as the 13th largest fabless IC provider in the world in 2010 interms of sales, while MediaTek was likely to rank fourth.

(By Jackson Chang and Frances Huang)