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LG Chem calls out SK Innovation

Sept 04,2019
As the fierce rivalry between Korean battery-makers LG Chem and SK Innovation continues to play out across Korea and the United States, LG on Tuesday laid out exactly how it thinks SK stole its trade secrets and demanded a promise of compensation.

LG Chem and SK Innovation have been embroiled in a battle over intellectual property in the U.S. for months after LG reported SK to the U.S. International Trade Commission (ITC) in April, accusing it of stealing trade secrets.

The conflict took another turn last Friday, when SK Innovation filed a suit in a United States federal court against LG Chem and LG Electronics, saying that efforts to solve problems through conversations had failed. LG Chem on Friday denied that it ever received an official request for talks, adding on Tuesday that any conversation would have to be between the two CEOs.

“If they truly believe themselves to be innocent, we urge [SK] to focus on the suit, instead of making efforts to curb public opinion and mislead the essentials,” LG said.

The company added it was “absurd” that SK labels its U.S. lawsuit an act that hurts national interests despite the competitor having “committed wrongful conduct in pursuit of its own interest.”

The No. 1 electric vehicle (EV) battery maker in Korea, LG Chem accused its competitor of violating trade secrets by hiring former employees in late April, when it first took its case to the ITC, asking the U.S. body to halt imports of SK batteries.

In late April, the No.1 battery maker said SK hired away 76 of its battery experts over the past two years. This number had increased to around 100 by Tuesday. A spokesman added that the number could increase in the future as LG is still in the process of internally investigating the damage.

The Tuesday statement also contained further details of how SK is suspected to have stolen trade secrets.

According to LG, SK targeted specific workers with a specialty in rechargeable batteries - a field LG Chem has been faster at developing than other local companies since the early 1990s - through headhunters and former employees.

Candidates that passed the document screening process were asked to write which projects they took part in and submit colleague names in the same team, LG added. During job interviews, SK asked former LG employees to describe their work, with SK employees that work in the same field present.

“We confirmed that candidates had written down our company’s core technology in detail, as well as reading or downloading confidential documents before leaving their former positions,” LG said.

The firm speculates that SK used the knowledge acquired to develop secondary, or rechargeable, batteries and win contracts. SK is now the third-ranked player in the local market.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]