TSMC Sues Ex-Executive Over Move to Join Intel

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(Bloomberg) -- Taiwan Semiconductor Manufacturing Co. sued a former executive who left to work for Intel Corp., saying there is a high likelihood that he leaked trade secrets from the world’s most advanced chipmaker to his new employer.

TSMC said it filed the lawsuit against Lo Wei-jen, a former senior vice president, on Tuesday at the Intellectual Property and Commercial Court in Taiwan. It said the legal action was based on a non-compete agreement that Lo had signed during his employment. A spokesperson for the court confirmed it received a lawsuit from TSMC on Tuesday.

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The unusual action from TSMC underscores the growing sensitivities around cutting-edge chip technology, which anchors not just the company’s leading global position but also Taiwan’s own geopolitical dynamic. The company regularly loses employees to competitors and other firms in the supply chain — but rarely of Lo’s standing and seniority.

“There is a high probability that Lo uses, leaks, discloses, delivers, or transfers TSMC’s trade secrets and confidential information to Intel, thus making legal actions (including claiming damages for breach of contract) necessary,” TSMC said in a statement.

Intel rejected the allegations. “Based on everything we know, we have no reason to believe there is any merit to the allegations involving Mr. Lo,” an Intel spokesperson said Wednesday in a statement. “Intel maintains rigorous policies and controls that strictly prohibit the use or transfer of any third-part confidential information or intellectual property.”

Lo, 75, was at one point in charge of research and technology development at TSMC and played a key role in facilitating the mass production of cutting-edge chips, including those used to make AI accelerators.

After a tenure spanning more than two decades, Lo left TSMC in July. The company said Lo had failed to disclose in his exit interview that he was planning to work for Intel, telling company lawyers he would join an academic institution.

Before he joined TSMC in 2004, Lo was employed at Intel focusing on advanced technology development, including running a chip factory in Santa Clara, California. Intel said Wednesday that Lo worked for 18 years as part of the process technology team at the company.

Talent moving between companies is a healthy part of the industry, the Intel spokesperson said in the statement, and the company welcomes Lo back.

Taiwan’s Ministry of Economic Affairs said in a statement that it will closely monitor the potential impact on the chip industry and it will collaborate with local prosecutors on an investigation into whether the case may have violated a national security law.

Local prosecutors have started looking into the reports to see whether any person broke any law after local media reported last week that Lo had taken proprietary knowhow from his former employer just before his departure.

Now valued at more than $1.15 trillion, TSMC has become the undisputed global leader in contract chipmaking, surpassing semiconductor pioneer Intel. The company’s data and fabrication techniques are highly prized trade secrets and a matter of strategic importance for Taiwan.

--With assistance from Ian King.

(Corrects exceutive’s name in the second paragraph. A previous story corrected the attribution in Intel’s statement to a spokesperson.)

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