Trial starts for Korean chip exec accused of stealing Samsung secrets for China factory

By Heekyong Yang and Ju-min Park

SUWON, South Korea (Reuters) – The trial of a South Korean chip executive accused of stealing sensitive information developed by Samsung Electronics (OTC:) began on Wednesday in a case that underscores South Korea’s crackdown on industrial espionage.

Prosecutors have alleged that Choi Jinseog, a former Samsung (KS:) Elec executive and a South Korean chip expert, stole sensitive information developed by the world’s top memory chipmaker to help his client set up a chip factory in China.

The high-profile criminal case against Choi, an award-winning engineer once seen as a star in South Korea’s chip industry, highlights Seoul’s efforts to crack down on industrial espionage and slow China’s progress in chip manufacturing.

Choi, now in custody in Suwon, a city south of Seoul where Samsung has its headquarters, attended the hearing in his beige prison uniform and denied all the charges.

“The defendant (Choi) never used or gave orders to use Samsung Electronics’ data,” Kim Pilsung, Choi’s lawyer, said, adding that what prosecutors claimed Choi had stolen were neither business secrets nor national core technology.

Choi briefly said “yes” when asked by a judge whether he agreed with his lawyer.

Prosecutors have also charged five former employees at Choi’s chip consultancy firm, Jin Semiconductor, and a former employee at a Samsung contractor.

The courtroom at the Suwon district court was packed with dozens of people including Choi’s families and friends.

In a letter to Reuters from prison last month, Choi rejected allegations he had sought to build a copycat chip factory in China with information illegally obtained via Samsung’s supplier network.

Samsung representatives were not immediately available for comment.