A manager for Samsung has admitted in court to passing Apple’s trade secrets to Mountain View-based Primary Global Research’s executive James Fleishman and an unnamed fund manager, after being granted immunity from prosecution by U.S. District Judge Jed Rakoff. Bloomberg describes how Suk-Joo Hwang, a long-time Samsung veteran, had passed information involving shipments of Samsung’s LCD displays to Apple before the original iPad debuted. He recalled one case of sharing trade secrets with Fleischman over lunch at a California restaurant:
One particular thing I remember vividly was that I talked about the shipment numbers of Apple, it was about iPad. This is in December 2009, before it came out with the tablet PC, they didn’t know the name then, so I talked to them about the tablet shipment estimates in that meeting.
Hwang told Judge that a visitor was intensely staring at their table, which led him to suspect that the person might have been an Apple employee. Shortly thereafter, Hwang learned that Samsung had lost a supply contract with Apple. “I thought, ‘Oh that guy was an Apple guy and they found out,’” Hwang said, adding he was “scared”.
And what did Fleishman do with this information?
They passed data to Primary Global’s clients, fund managers, who used it to their own advantage. In addition to working for Samsung, Hwang admitted to working as an expert-networking consultant for PGR from 2004 to 2010, anonymously since 2010, netting a cool $38,000. It was basically the award for sharing Apple’s trade secrets with PGR. Samsung fired Hwang this summer after the FBI knocked on his doors last October. Fleishman is charged with two counts of conspiracy, for which he could face up to 25 years in prison.