Hyosung accuses LSIS of tech theft

Cho Suck-rai Hyosung Chairman

Hyosung Corporation accused LSIS, the biggest manufacturer of power-transmission components in the country, of technology theft prompting authorities to start investigating the firm.

Hyosung is seeking massive compensation from LSIS, claiming that the latter stole technology related to power transmission and control, costing it several billions of dollars. LSIS is declining to comment, but is known to be preparing for an extensive legal battle.

Investigators from Seoul Metropolitan Police are questioning four former Hyosung executives who moved to LSIS over suspicions that they leaked trade secrets related to high voltage, direct current (HVDC) transmission technology to their new employer.

Koo Ja-kyun LSIS CEO

Hyosung and LSIS are bitter rivals in the growing market for HVDC solutions and technology.

HVDC is considered a crucial advancement over alternating current (AC) technology in electrical power transmission due to its advantages in efficiency over long distances and point-to-point transmission, better control over power flow and reduced line loss. It is also used increasingly in efforts to build “smart’’ grids ― power grids that monitor and control supply and demand through online architecture.

Energy market researcher, Pike Research, believes the annual investment in HVDC-related technology will grow from $8.4 billion in 2010 to over $12 billion in 2015.

According to Hyosung officials, a former executive, identified only as Lee, downloaded documents on HVDC technology from Hyosung’s servers to his external hard disk drive without permission and is suspected of having provided the files to LSIS.

“We believe that these people have partnered with LSIS in stealing our patented HVDC technology. This was definitely a crime and that is why police are investigating it. Our knowledge is that the case has been recently passed to prosecutors,’’ said a senior Hyosung executive.

“Much of our future technology related to HVDC, static synchronous compensator (STATCOM) smart girds, wind power generation, solar cells and electric vehicles was leaked to LSIS. LSIS as a company was definitely behind this as it has been looking for a shortcut to our advances. He said that the economic loss could be as much as 800 billion won (about $710 million).

Industrial espionage scandals have been occurring quite frequently in Korea’s hyper-competitive technology sector. Most recently, Samsung Electronics accused its flat-panel rival, LG Display, of attempting technology theft.

A total of 11 people, including three LG executives, have been indicted in a local court over allegations of espionage related to organic light emitting diode (OLED) technology. <The Korea Times/Kim Yoo-chul>

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