Ex-TSMC employee suspected of selling secrets to Shanghai

Contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) believes a former manager may have stolen trade secrets concerning 12-inch wafer technology and sold them to a Chinese company.

TSMC, the world's largest maker of chips on a contract basis, has also filed suit against the former employee.

The Hsinchu District Prosecutors' Office said yesterday it recently took over the case from the Criminal Investigation Bureau under the National Police Administration.

Hsinchu prosecutors said that TSMC first reported the case to the Criminal Investigation Bureau in January.

According to TSMC, the manager -- who was only identified as Liu (劉) in complaint documents -- was in charge of 12-inch wafer development at the company.

TSMC suspects the employee began to steal trade secrets related to 12-inch wafer manufacturing technology at the beginning of last year.

According to the company, the manager used TSMC's computer network to e-mail information to another address belonging to the worker.

The information was then forwarded to a competing company in Shanghai, where the manager was later hired after leaving TSMC last spring.

The Shanghai company wasn't identified.

However, Grace Semiconductor Manufacturing Co, which is owned in part by the sons of Chinese President Jiang Zemin (江澤民) and the chairman of the Formosa Group, Wang Yung-ching (王永慶), is based in Shanghai.

The company has announced that it plans to set up a 12-inch foundry.

Semiconductor Manufacturing International Co -- which is run by Taiwan's Richard Chang (張汝京), who once led a company that later merged with TSMC -- is also based in Shanghai.

TSMC said that its computer technicians have now installed firewalls to prevent further leaks of trade secrets.

Lo Hsueh-mei (羅雪梅), a spokeswoman for the Hsinchu District Prosecutors' Office, said investigators have yet to confirm that the leaked trade secrets concerned 12-inch wafer manufacturing technology.

"I cannot tell you the first name of Liu or confirm if the information the person leaked concerned 12-inch chips," the spokeswoman said. "Cases like this happen all the time, but companies don't always bring them to court. This must be something important to the company, that's for sure."

Lo couldn't say whether the suspect is still in Taiwan.

Prosecutors plan to summon the former TSMC employee for questioning, the spokeswoman said

Dick Thurston, vice president and general counsel at TSMC, wouldn't elaborate on what kind of information was stolen, either.

"We decided to sue her because she stole our intellectual property," Thurston said.