Samsung tech leak: Chipmaker CXMT faces legal action in Korea
What's the story
South Korean prosecutors have indicted 10 people, including former Samsung Electronics executives, for allegedly leaking the firm's technology to Chinese chipmaker ChangXin Memory Technologies (CXMT). The Seoul Central District Prosecutors's Office announced that five suspects have been arrested. This includes a former Samsung executive who is accused of recruiting key personnel and leaking proprietary technology to CXMT.
Legal repercussions
Charges and implications of the technology leak
The accused face charges under South Korea's Unfair Competition Prevention Act and Industrial Technology Protection Act. Another five individuals, including CXMT employees, have been indicted without detention on similar charges. The prosecution alleges that CXMT hired a former Samsung vice-president as head of its research department soon after its establishment in 2016. This executive allegedly played a key role in recruiting top Samsung engineers to accelerate development of CXMT's 10-nanometer dynamic random access memory (DRAM) technology.
Technology theft
Samsung's proprietary DRAM manufacturing processes leaked
A former Samsung researcher is also accused of hand-copying the company's "Process Recipe Plan" for DRAMs, a key document in its manufacturing program. This information was allegedly given to CXMT, helping it become the first Chinese company to mass-produce 10nm DRAMs in 2023. The move reportedly cost Samsung an estimated $3.5 billion in sales in 2024 alone.
Industry challenge
CXMT's advancements and market impact
Last month, CXMT made significant strides with the launch of its latest Double Data Rate 5 (DDR5) DRAM products. The development is part of the company's efforts to take on South Korean memory giants Samsung and SK Hynix as well as US-based Micron Technology. The leaked technology included 10nm DRAM processes that Samsung had spent 1.6 trillion won developing, prosecutors said.