Three former Inventec executives sentenced for trade secrets infringement

　Inventec Corporation (“Inventec”) sued three of its former executives, who are JIANG Ying-Fan (hereinafter “Jiang”), ZHU Jun-Hao (hereinafter “Zhu”), and WU Zhong-Hui (hereinafter “Wu”), for breach of confidentiality agreements after the three individuals joined Compal Electronics, Inc. (“Compal”) in 2017.  In 2018, the Taipei District Prosecutors Office prosecuted the three defendants and Compal and then convicted them of violation of Trade Secrets Act on May 21, 2025.  Jiang and Zhu were sentenced to 30 months and 16 months in prison, respectively, for the offense of knowingly disclosing the trade secrets possessed by others through unauthorized reproduction as defined by the Trade Secrets Act, while Wu was sentenced to 6 months in prison, convertible to a fine of TWD180,000, for infringing another’s economic rights through unauthorized reproduction as defined by the Copyright Act.  Compal was fined TWD200,000 for violating the Copyright Act.  

　As to the incidental civil action also initiated against the three defendants, Jiang, Zhu, and Wu each should pay Inventec damages in the amounts of TWD3.2 million, TWD300,000, and TWD100,000, respectively.  The court also ordered that the three defendants and Compal should delete and destroy the relevant trade secrets they each held and be prohibited from retaining, using, modifying, or disclosing, communicating, or transferring the trade secrets to any third persons by any means, or otherwise making them known to or available for use by any third party. 

　According to the prosecutor’s findings, Jiang and the other two defendants were all former senior executives at Inventec, who had authorized access to the confidential documents regarding high-end server production and had signed non-disclosure agreements with Inventec. They, however, successively left Inventec and joined Inventec’s rival company, Compal between September 2017 through March 2018.  According to Inventec’s criminal complaint, before he left Inventec, Jiang transferred 12 trade secrets including production and shipment forecast information, production capacity, defect rates, cost and quotation analysis, product testing plan, production line technology, fast boundary scan technology, to a Chinese national working as an HR assistant at Compal.  Zhu, in three days after joining Compal, obtained the files of Inventec’s technical trade secrets from Compal’s Chinese employee, Zhang, who previously worked at Inventec, and then forwarded these files to Compal’s procurement supervisors and staff by email via Compal’s email system.  Moreover, prior to his resignation, Wu forwarded to Jiang the files containing Inventec’s technical trade secrets he got access to due to his position at Inventec via his personal email box.

　The Taipei District Court determined that Jiang, Zhu, and Wu each should receive prison sentences ranging from 6 months to 2.5 years for the offense of disclosing Inventec’s trade secrets without authorization or infringing Inventec’s economic rights, and all of them denied the offenses they were charged with and failed to reach a settlement with Inventec.  In addition, Compal was fined in an amount of TWD200,000 based on the court’s finding that neither Compal’s representative nor relevant supervisors had expressively or implicitly instructed Jiang and Zhu or instigated them to commit copyright infringement; the court determined that the acts were committed on personal basis.  This case is appealable.  (Released 2025.05.21) 
/CCS