Court Jails Former Tokyo Electron Employee for Stealing TSMC Secrets

A Taiwan court has sentenced a former employee of Tokyo Electron to 10 years in prison for stealing sensitive trade secrets from Taiwan Semiconductor Manufacturing Company, in a landmark case highlighting growing concerns over industrial espionage in the global semiconductor industry.

The ruling, delivered by Taiwan’s Intellectual Property and Commercial Court, is one of the most high-profile prosecutions under the island’s National Security Act, reflecting heightened efforts to protect critical chip technology amid intensifying global competition.

The main defendant, Chen Li-ming; who previously worked at TSMC before joining Tokyo Electron’s Taiwan unit, was found guilty of illegally obtaining confidential data related to advanced semiconductor processes. He was accused of leveraging his former connections within TSMC to access sensitive information, which he then copied and shared to benefit his new employer.

According to the court, the stolen materials were linked to cutting-edge chip technology, including TSMC’s advanced 2-nanometre processes, which are central to the production of high-performance chips used in artificial intelligence and other advanced applications.

In addition to the 10-year sentence handed to Chen, four other individuals received prison terms ranging from two to six years, while another former Tokyo Electron employee was given a suspended sentence for destroying evidence.

The court also fined Tokyo Electron’s Taiwan unit 150 million New Taiwan dollars (approximately $5 million), citing failures in supervision, though it noted there was no evidence of direct organisational involvement in the data breach.

TSMC, the world’s largest contract chipmaker and a key supplier to global tech giants, reiterated its zero-tolerance stance on trade secret violations and pledged to strengthen internal safeguards.

The case underscores the strategic importance of semiconductor technology, particularly as demand for advanced chips surges with the rapid growth of artificial intelligence. Analysts say the ruling sends a strong message about Taiwan’s determination to safeguard its technological edge and national economic security.

Legal experts note that the outcome could set a precedent for how countries handle intellectual property theft in high-tech industries, especially as geopolitical tensions increasingly intersect with competition over critical technologies.