HTC shares plummet as prosecutors begin examining suspects' files in trade secrets case
By John Liu, The China PostHigh-ranking HTC managers may have given sensitive company data to smartphone manufacturers in mainland China, according to prosecutors investigating an alleged fraud at the phone maker.
September 3, 2013, 5:05 pm TWN
HTC's shares plummeted yesterday, indicating that investors are concerned about the possible ramifications of an alleged trade secrets heist by senior employees at HTC.
In an effort to discover if sensitive information has been leaked to third parties, prosecutors examined the computer files of two high-ranking HTC managers, Chien Chih-lin (簡志霖) and Wu Jian-hong (吳建宏), yesterday. The files were thought to include smartphone designs, figures and graphics, as well as a customer name list.
HTC accused the two managers of revealing trade secrets to businesses in mainland China. The suspects gave under-development figures and graphic interfaces to smartphone manufacturers in mainland China, according to prosecutors.
In defense, the two have said that “these are not trade secrets.”
In order to maintain company morale, HTC Chief Executive Officer Peter Chou (周永明) sent a letter to employees at HTC yesterday stressing the importance of solidarity during challenging times.
Reports of the alleged malfeasance erupted last Friday, with prosecutors raiding the company's offices after the close of trading, rounding up several executives for questioning, and detaining two.
According to prosecutors, HTC has initiated litigation against Chien and Wu as well as senior staff for alleged industrial espionage and fraud.
While attending a Hello Kitty press conference yesterday, HTC North Asia President Jack Tong (董俊良) said he was confident about the upcoming product launch, despite the scandal, adding that the new product “will soon appear.”
Yesterday was the first workday for HTC employees since the alleged fraud was revealed. In his letter, Tong said that it takes courage and determination to withstand difficult times. HTC will insist on doing the right thing and the company's value will not be affected by a few employees, Tong added.