Japanese chip manufacturer Rapidus allegedly involved in TSMC scandal

In Taiwan, the data theft scandal at the world's largest chip contract manufacturer Taiwan Semiconductor Manufacturing Company (TSMC) is spreading. Numerous local online and television media are reporting on the case. According to these reports, there are now nine suspects who are said to have been involved in the disclosure of internal information. Some of them worked both in TSMC's most important 2-nanometer plant (Fab 20) and in the adjacent research center.

The suspects are accused of opening and photographing internal files about TSMC's 2-nanometer process generation in their home office. According to the United Daily News (UDN), over 400 images are said to have been created and passed on in this way. On Tuesday, it was reported that Taiwanese authorities had also searched the offices of supplier Tokyo Electron (TEL) in Taiwan. Tokyo Electron builds essential machines for semiconductor production, including etching and coating systems that TSMC also uses.

A connection is now emerging: According to consistent media reports, the images are said to have reached Tokyo Electron employees who used to work at TSMC themselves. These employees are said to have passed on the trade secrets to the young Japanese chip contract manufacturer Rapidus.

Rapidus is also building up 2 nm production

Rapidus is currently building its first semiconductor plant with massive government funding and in cooperation with IBM, Fraunhofer and Japanese universities. Chips with 2 nm technology are being produced there, albeit initially on a small scale. The TSMC information should be useful for optimizing the production facilities. TSMC's knowledge is valuable, for example, to increase chip yields.

Numerous media outlets quote Lu Xingzhi as an experienced commentator on semiconductor issues. He suggests that Tokyo Electron and Rapidus would have to pay damages of several billion US dollars in the event of a guilty plea. However, he also raises the question of how to assess whether Rapidus is using the illegally obtained trade secrets at all: Is it an infringement if employees steal the information but the company does not use it?

In the early 2000s, there was already a precedent in which former TSMC engineers moved to the Chinese chip contract manufacturer SMIC and passed on trade secrets. In addition to a fine, TSMC received ten percent of SMIC shares in 2010. TSMC has sold these shares over the years, most recently in 2019. Lu Xingzhi therefore also believes it is possible that TSMC will receive Rapidus shares.

(mma)