Ahn Seung-ho, a former Samsung Electronics (005930) executive vice president indicted for obtaining leaked internal information and using it in a patent infringement lawsuit, received a prison term on appeal and was taken into custody in the courtroom.
The Seoul High Court's Criminal Division 3, presided over by Judge Lee Seung-han, on the 27th sentenced Ahn to three years in prison, the same term handed down by the lower court, on charges of violating the Unfair Competition Prevention and Trade Secret Protection Act. The court revoked his bail and ordered him detained again.
A former Samsung Display patent filing group head surnamed Lee, tried alongside Ahn, was sentenced to four years in prison and ordered to forfeit about 532 million won ($370,000). That is heavier than the three-year term imposed at the first trial. Another former Samsung Electronics IP Center employee, also surnamed Lee, who is accused of leaking internal materials, received three years, up from two years in the first trial.
Ahn was indicted on charges of obtaining confidential patent analysis materials from a Samsung Electronics IP Center employee and using them in a patent infringement lawsuit against the company. He oversaw patent development and patent litigation at Samsung Electronics before leaving in 2019 and founding Synergy IP, a patent management firm. In August 2021, he improperly obtained a report containing Samsung Electronics' confidential information and, based on it, filed a patent infringement suit in a U.S. court seeking a $90 million settlement.
Ahn's side argued during the trial that the leaked information did not constitute trade secrets, but the appeals court, like the lower court, recognized the information as trade secrets.
The court found that the internal review results and response strategies on patents were information not known outside the company and that they had economic value and were managed as confidential, qualifying them as trade secrets. It also concluded that the defendants intended to gain financial benefit by using the internal information in patent transactions or negotiations, or to cause losses to Samsung Electronics.
In raising the sentences for some defendants, the court strongly criticized the use of leaked trade secrets for personal gain. "The nature of the offense is very bad and the crimes involved are multiple," the court said. "A social alarm must be sounded over the betrayal of leaking trade secrets of the company one belongs to, causing it losses and using that to pursue personal gain."