Prosecutors seek NT$120M fine against Tokyo Electron Taiwan in TSMC case

Taipei, Dec. 2 (CNA) Taiwan's prosecutors on Tuesday indicted Tokyo Electron Taiwan Ltd., a subsidiary of Japan-based chip equipment supplier Tokyo Electron Ltd., over the alleged theft of Taiwan Semiconductor Manufacturing Co.'s (TSMC) 2-nanometer (2nm) technologies, and are seeking a fine of NT$120 million (US$3.82 million).

The case involves the alleged theft of TSMC's 2-nanometer (2nm) core semiconductor technologies, one of the most advanced semiconductor manufacturing nodes in the world and considered critical to Taiwan's national security.

In August, the Intellectual Property Branch of the Taiwan High Prosecutors Office charged former TSMC engineer Chen Li-ming (陳力銘) -- who later worked at Tokyo Electron Taiwan -- and two TSMC engineers, Wu Ping-chun (吳秉駿) and Ko Yi-ping (戈一平), with supplying confidential 2nm-related information to benefit Tokyo Electron Taiwan.

On Tuesday, prosecutors additionally charged Tokyo Electron Taiwan Ltd. with four offenses under the Trade Secrets Act and National Security Act, according to a press release issued by the office.

Prosecutors sought fines of NT$40 million, NT$8 million, NT$40 million and NT$40 million for each of the alleged offenses, and requested that the combined enforceable penalty be set at NT$120 million.

When a defendant commits multiple offenses, the court sets a penalty for each and then determines a single fine under the Criminal Code, which need not equal the sum of the individual fines.

Prosecutors said the company had a legal duty to supervise Chen, but lacked concrete measures to prevent wrongdoing, relying on only its internal rules.

As a result, they concluded that Tokyo Electron Taiwan "failed to take adequate steps to prevent the illegal acts and should bear criminal liability as a legal entity."

In August, prosecutors said they were seeking prison terms of 14 years for Chen, nine years for Wu and seven years for Ko. On Sept. 1, the Intellectual Property and Commercial Court ordered that the three be detained and held incommunicado.

Two days after the engineers were indicted, Tokyo Electron Ltd. confirmed that a former employee of its Taiwanese subsidiary was involved in the case, but said its internal investigation had found no evidence that confidential TSMC 2nm information had been leaked to a third party. The company said it had dismissed the employees involved and was cooperating fully with authorities.

As of press time Tuesday, Tokyo Electron Ltd. had not issued a new public statement in response to the latest prosecutorial action.