Micron Embroiled In Another Trade-Secrets Theft Case

Five Micron Technology ex-employees who were working at Inotera Memories, a subsidiary of the company, were recently taken to court over charges of passing trade secrets illegally. According to Taiwanese prosecutors the five employees took classified documents belonging to Inotera and passed them on to a firm based in China.

The Taiwanese prosecutors did not reveal the name of the recipient firm though according to reports that appeared in the Taipei Times, the company was identified as Tsinghua Unigroup, a state-backed technology giant. According to the reports Tsinghua Unigroup paid the employees approximately $6,576 every month in order to acquire the classified documents. This amount was about triple what they were earning at Inotera.

Classified documents

The classified documents were delivered to Tsinghua Unigroup in various ways including WeChat messages, emails, paper copies and photos and this was last year between the months of September and November. Initially Micron’s stake in Inotera was 33% but last year in October the technology company acquired the remaining 67%.

This is the second trade secrets incident involving Micron in Taiwan as there was another one involving the chip maker and the second-biggest contract manufacture of chips in Taiwan, UMC. In the UMC case, two Micron ex-employees passed trade secrets of the chipmaker to their current employer, UMC. The contract manufacturer then passed the trade secrets to its joint venture with Fujian Jin Hua Integrated Circuit, a chipmaker based in China. This was an indication that the memory chip designs of Micron Technology were getting leaked into the market in China. The new case is a further sign that Micron’s woes are far from over.

Government policy

In order to avoid the country’s dependence on technologies from foreign countries, the Chinese government is engaged in efforts to develop a local semiconductor industry. China is convinced that it can increase the revenues of domestic chip firms by over 20% per year and develop it to a market worth $53 billion by 2020.

To achieve this the main tool of the Chinese government is the state-backed tech giant, Tsinghua Unigroup. The tech behemoth has recently been on an acquisition spree and has acquired companies such as Spreadtrum and RDA Microelectronics, the two largest chipmakers in China. Tsinghua Unigroup has also bought a controlling interest in H3C, a firm now jointly owned with Hewlett Packard Enterprise. The Chinese tech behemoth had also attempted to acquire Micron Technology as well as a controlling interest in Western Digital though U.S. regulators blocked both deals.

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