Six employees from HTC were recently charged by Taiwanese prosecutors for revealing company secrets. The employees also got in trouble for making up incorrect expense reports and accepting kickbacks.
HTC design executives involved in theft
The Wall Street Journal reported one of the employees who was indicted was Thomas Chien, vice president of product design. These employees initially planned to introduce their own phone design company in China and Taiwan. This group was also accused of receiving $1.1 million in kickbacks as well as falsifying invoices from suppliers.
Taipei Times released the names of the other indicted employees including HTC research and development director Wu Chien-hung, HTC senior manager for design and innovation Huang Kuo-ching, senior manager Huang Hung-yi, manufacturing design department manager Hung Chung-yi, and Chen Shih-tsou.
HTC released public statement
HTC released the following statement regarding the issue:
"The company expects employees to observe and practice the highest levels of integrity and ethics. Protecting the company’s proprietary and intellectual properties, privacy and security is a core fundamental responsibility of every employee. The company does not condone any violation."
Chien took key designs of the soon-to-be unveiled HTC phone and shared the designs with potential business partners last summer. His actions violated Article 13 of the Trade Secrets Act, which prohibits revelations, unauthorized reproduction and stealing corporate secrets. This case is the first since the recent law revision from early 2013. Thanks to the amended law, those who reveal corporate secrets to China (or other countries) could be subjected to 10 years in prison and a fine up to NT$50 million. For cases with illegal gains that surpass that number, the fine can increase up to 10 times that number.
Prosecutors are hoping to get the maximum penalty for Chien. It's reported that he displayed no remorse for his actions and he's putting up arguments in efforts to justify his actions. Prosecutors also claimed that all except for Chung-yi admitted wrong-doing. Kuo-ching and Hung-yi already settled their disputes with HTC and were subsequently forgiven, however prosecutors want to recommend suspension for both employees.