Ex-Samsung employee's chip leak sentence cut on appeal

A former Samsung Electronics employee convicted of leaking the Korean chipmaker’s memory technology to CXMT had their prison sentence reduced from seven years to five years on appeal Thursday.

The Seoul High Court found Jeon guilty of leaking and using Samsung’s classified 18-nanometer dynamic random access memory (DRAM) technology at CXMT, where they oversaw equipment investment after joining the company in 2016.

"The defendant's actions warrant severe condemnation, as the leak of Samsung Electronics' nationally critical technology posed a serious threat to Korea's industrial competitiveness," the court said. “The defendant must be held accountable for the consequences of their actions."

The appellate court, however, found grounds for leniency.

Although Jeon compiled equipment investment information for the so-called Hefei Project while working at the Chinese chipmaker, Jeon was not directly involved in semiconductor development. Jeon’s testimony in a separate technology theft case involving CXMT also worked in the defendant's favor, as the court recognized the efforts to help establish the facts.

"The seven-year prison sentence imposed by the lower court was excessive in some respects," the appellate court said.

Investigators also found that Jeon received approximately 2.9 billion won ($2.2 million) from CXMT over six years, including contractual incentives and stock options.

The findings also showed that the Samsung technology Jeon and others used was an 18-nanometer Process Recipe Plan stolen by a former process architecture engineer surnamed Park. In September 2016, Park allegedly copied the process specifications by hand onto 12 pages of notes and smuggled them out of the company. Park is currently the subject of an Interpol Red Notice.

Jeon, who had denied the charges throughout the first trial, reversed their position on appeal and admitted to the allegations in the indictment.

Jeon publicly apologized in court for the first time on Sept. 9.

"Samsung Electronics is the biggest victim in this case," Jeon wrote in a letter of remorse submitted to the court. "I thought that an honest confession would also help prevent a recurrence."

During the appeal, Jeon also testified that CXMT executives had personally pressured Korean employees to steal Samsung's technology. Former CXMT CEO David Wang summoned Jeon and other Korean employees between October and December 2016 and demanded that they bring Samsung's process recipes and equipment information to the Chinese company, according to a written statement obtained by the JoongAng Ilbo.

"Bring me all the Samsung process recipes and equipment information you have,” Wang reportedly told Korean CXMT employees. “If you don't, I'll report you to the Korean government. I have contacts who can verify whether the information really comes from Samsung, so don't think you can get away with lying.”

Jeon described the experience as "frightening and terrifying."

Trials involving other former Samsung employees who moved to CXMT are also underway.

A former Samsung executive identified only by their surname Yang, who headed CXMT's second-phase development division, and former team leaders responsible for eight key semiconductor processes are currently standing trial in district courts.

Another former Samsung employee, identified only by the surname Kim, joined CXMT alongside Jeon and headed the Chinese company's first-phase development division. Kim was sentenced to six years and four months in prison and fined 200 million won in April during a retrial following a Supreme Court remand.

BY LEE YOUNG-KEUN [[email protected]]