Taiwan’s UMC to aid US pursuit of Chinese chip maker Fujian Jinhua over alleged theft of Micron trade secrets

Taiwan’s United Microelectronics Corporation (UMC) pledged “substantial assistance” to the US in a high-profile trade-secrets prosecution of Chinese chip maker Fujian Jinhua Integrated Circuit.

UMC pleaded guilty Wednesday in San Francisco federal court in a deal with US prosecutors, who agreed to drop serious charges of economic espionage and conspiracy for the alleged theft of proprietary information from Idaho-based Micron Technology. UMC instead admitted to trade-secret theft and agreed to pay a US$60 million fine.

The guilty plea resolves one piece of a complicated, international prosecution of an allegedly illegal transfer of Micron’s memory design in a chip manufacturing deal between Taiwan-based UMC and Jinjiang-based Fujian Jinhua. But it also leaves key questions unanswered.

The case was the first filed under the Trump administration’s “China Initiative,” a Justice Department program aimed at prioritising trade-theft cases and litigating them as quickly as possible. With UMC removed as a defendant, China becomes the target as tension with the West is aggravated by issues including Beijing’s hacking and control of key technologies, its handling of the Covid-19 outbreak, tightening grip over Hong Kong and treatment of Muslim Uygurs.

“UMC takes full responsibility for the actions of its employees, and we are pleased to have reached an appropriate resolution regarding this matter,” the company said in a statement.

“UMC’s guilty plea points this case towards trial against Fujian Jinhua in 2021,” said US lawyer David L Anderson. “Criminal trade secrets cases protect freedom and innovation. These cases have global significance when a foreign defendant is charged with stealing intellectual property protected by US law.”