The rivalry between the semiconductor giants has escalated into a legal crisis due to allegations of trade secret theft, which began when a retired senior TSMC executive joined Intel. TSMC announced that it has filed a lawsuit against the executive, while Taiwanese authorities have also joined the case, launching a full-scale investigation. Intel vehemently denies the allegations.

Spying Crisis Between Intel and TSMC!

Wei-Jen Lo, the Taiwanese engineer at the center of the dispute, joined Intel this fall. He was appointed Vice President of R&D to improve the company’s manufacturing processes.

Lo worked at Intel in the 1980s and then moved to TSMC in 2004, where he held critical positions during the company’s most successful years. TSMC suspects Lo of obtaining copies of confidential technical documents related to advanced process technologies.

TSMC announced this week that it has filed a lawsuit against Lo. The company alleges that Lo violated his employment contract, non-compete clauses, and the Taiwan Trade Secrets Act. TSMC stated, “There is a high probability that Lo will use, transfer, or leak TSMC’s trade secrets and confidential information to Intel. Therefore, it has become necessary to take legal action.”

Immediately following TSMC’s statements, Taiwanese prosecutors intervened and launched an investigation into Lo. As part of the investigation, Lo’s two homes were searched, and computers, USB drives, and other data storage devices were seized.

In addition, authorities may freeze Lo’s real estate assets and stock. An Intel spokesperson told Reuters that the company had no reason to believe the allegations against Lo were true.

The spokesperson emphasized that Intel has policies that strictly prohibit the transfer of confidential information to third parties. Taiwan takes trade secrets seriously and earlier this year launched an investigation into three people accused of helping a Japanese rival steal TSMC’s chipmaking technology.