In a marked departure from its long-standing precedents, the Korean Supreme Court held that, even where multiple parties conspire to jointly use misappropriated trade secrets, the individual use of such trade secrets among each of the conspirators constitutes an independent criminal offense.  The Court further made it clear that the disclosure or acquisition of trade secrets among the co-conspirators itself constitutes a distinct criminal act under the Unfair Competition Prevention and Trade Secret Protection Act (the “UCPA”), warranting separate criminal sanctions (Supreme Court Case No. 2025Do11906, rendered on January 15, 2026).

▶Background of the Case 

This case arose from a trade secret misappropriation dispute involving camera module inspection equipment technology.  The defendants, former employees of a Korean company, were engineers responsible for designing and manufacturing so-called “grabbers,” components used in smartphone camera module inspection equipment.  After leaving the employment, the defendants allegedly became engaged by foreign competing companies and conspired to use the Korean company’s proprietary technology to develop competing grabber products with identical functions.

The prosecution charged the defendants with violations of the UCPA for acquiring trade secrets with the intent or knowledge that they would be used abroad, and for disclosing such trade secrets to third parties.  The alleged trade secrets included technical materials relating to the Korean company’s grabber technology, such as source code files, circuit diagrams, and component lists.  In particular, the prosecution claimed that these materials were transferred among the defendants through various means, including USB drives and group chat messages, and were intended to be jointly used in the development of competing products for the foreign companies, thereby constituting separate acts of trade secret disclosure and acquisition.

▶Lower Court Decisions

The Seoul Central District Court and the Seoul High Court, on appeal, ruled that the defendants who had initially leaked the trade secrets unlawfully taken from the employer were guilty of trade secret disclosure.  The courts also upheld the defendants’ convictions for trade secret usage, concluding that the defendants had jointly used the trade secrets as co-principals in the offense.

However, with respect to the exchanges of trade secrets among the defendants, the courts considered that such conduct merely constituted acts carried out in furtherance of their agreed-upon use of the trade secrets.  On this basis, the courts determined that the transfer of trade secrets among the conspirators did not amount to “disclosure to a third party” or “acquisition from a third party” under the UCPA, and acquitted the defendants of those charges, in accordance with the long standing stance taken by Korean courts in trade secret cases involving multiple defendants acting in concert.

▶Supreme Court Decision

The Supreme Court reversed the lower court decisions and remanded the case to the Seoul High Court for further review, establishing a new legal standard for assessing trade secret transfers among co-conspirators.

The Court held that, when a person discloses or transfers trade secrets to another person who is not yet aware of the trade secrets, with the intent to obtain improper benefits or cause damage to the trade secret holder, both the crime of trade secret disclosure (for the transferor) and the crime of trade secret acquisition (for the transferee) have taken place under Article 18 of the UCPA, regardless of whether the parties conspired to jointly use the trade secrets or actually used them together.

The Court provided the following grounds for its decision.

First, the Court reviewed the legislative history of the UCPA and noted that the January 8, 2019 amendment broadened the statute to cover various forms of misconduct, including the unauthorized removal of trade secrets from designated locations, retention of trade secrets after being requested to delete or return them, acquisition through theft, fraud, coercion, or other improper means, and the acquisition or use of trade secrets with knowledge that such improper acts are involved.

The Court emphasized that this legislative evolution reflects a clear policy objective of strengthening the protection of corporate trade secrets by expanding the scope of punishable conduct.  Accordingly, when determining whether offenses under Article 18 of the UCPA have occurred and enumerating the offenses, such legislative intent must be fully taken into account.

Next, the Court noted that trade secret usage does not necessarily require, nor is it typically preceded by, prior disclosure or acquisition.  A person who becomes aware of trade secrets within the course of employment may be deemed to have already acquired those trade secrets and to use them without any separate act of acquisition.  The Court further restated that Article 18 of the UCPA requires only the “intent to obtain improper benefits or cause damage to the trade secret holder” for disclosure and acquisition offenses, and does not require that actual usage be the objective.  The Court also opined that cases involving disclosure, acquisition, and usage of trade secrets entail greater harm to protected interests and a higher degree of culpability than cases involving usage alone.

▶Implications of the Decision

This decision represents a marked departure from prior Korean jurisprudence and is expected to have a significant impact on future trade secret disputes in Korea.  By recognizing the transfer of trade secrets among co-conspirators as separate offenses of disclosure and acquisition, the Supreme Court has expanded the scope of criminal liability in trade secret misappropriation cases.  As a result, prosecutors may charge each transfer as a separate offense, potentially leading to increased penalties through cumulative sentencing.