TSMC 2-nanometer “inside man” sentencing upheld: Former engineer gets 10 years, Tokyo Electron fined 150 million New Taiwan dollars

According to a report by United Daily News (聯合新聞網), on April 27, the Taipei court issued its verdict in the first instance regarding the “TSMC 2-nanometer process insider leak/mole case.” All four former TSMC engineers were found guilty; the main defendant, Chen Liming (陳力銘), was sentenced to 10 years in prison. In addition, Tokyo Electron’s Taiwan subsidiary, “Tokyo Electron Taiwan Co., Ltd.” (東京威力科創股份有限公司), was fined 150 million New Taiwan dollars (NTD) under Taiwan’s National Security Act, including payments of 100 million NTD to TSMC and 50 million NTD to the government. This case is the first indictment and final ruling in Taiwan under the National Security Act targeting a legal entity, and it is also the first criminal penalty under the National Security Act applied to a foreign technology company.

Four former TSMC engineers sentenced to 2–10 years; main defendant Chen Liming sentenced to 10 years

All four defendants were former TSMC engineers, each sentenced as follows:

Chen Liming — 10 years (prosecutors originally sought 14 years; main defendant)

Chen Weijie — 6 years

Wu Bingjun — 3 years

Ge Yiping — 2 years

The court found that the four defendants jointly stole and leaked TSMC’s core trade secrets—“14-nanometer and below IC manufacturing process, key gases, chemicals, and equipment technology.” After Chen Liming left TSMC, he joined Tokyo Electron at its Taiwan subsidiary and asked the other three individuals who were still employed or former colleagues for confidential documents. The purpose was to help Tokyo Electron break into the equipment supply chain for TSMC’s advanced process.

Tokyo Electron Taiwan fined 150 million NTD; first legal-entity case under the National Security Act

In addition to individual criminal liability, Tokyo Electron at its Taiwan subsidiary was fined a total of 150 million NTD, broken down as follows: 100 million NTD to be paid to TSMC, and 50 million NTD to be paid to the government. Lu Yiyin (盧怡尹), the head of marketing at Tokyo Electron Taiwan, was also sentenced to 10 months and given a suspended sentence due to evidence issues.

This case is Taiwan’s first criminal prosecution and final ruling under the National Security Act against a “legal entity,” and it is also the first case prosecuted under the “foreign technology transfer” framework. In the prosecution stage in December 2025, prosecutors originally sought a fine of 120 million NTD; today, at the final ruling stage, the amount was converted to be denominated in yen, with the real scale of the fine increased.

Leaked technology below 14 nanometers; goal to move into TSMC process orders

The criminal motive revealed in the judgment was not simply stealing technology and starting anew, but rather to secure a more favorable position for Tokyo Electron within the equipment supply chain of TSMC’s advanced process. In other words, the leaked technical details became the “reverse engineering” basis for Tokyo Electron’s equipment calibration and specification design, thereby improving the fit between its products and TSMC production lines and reducing the risk of being replaced by existing suppliers (such as U.S.-based Applied Materials and Lam Research).

For TSMC, 2 nanometers is its next-generation core production process, with mass production originally planned for the second half of 2026. The related technical details are the highest-level business secrets. The timing of this leak coincided with TSMC’s stock price reaching a historic high of NT$2,300, yet the market reaction was relatively calm, indicating that investors believed that the final judicial ruling would instead help solidify the technology moat and reduce the likelihood of major future leaks.

Another case: TEL cuts China-region executives; family ties linked to Suzhou Xinwei

In almost the same period, Reuters, citing the Financial Times, further disclosed that Tokyo Electron has removed a job-related connection involving a senior China-region management executive, Chen Jie. Chen Jie previously served as TEL’s China-region负责人; his family has investments in “Suzhou Xinwei Semiconductor” (蘇州新匯半導體). That company originally provided equipment engineering services for TEL in China, but later shifted to independently developing and manufacturing chip-making equipment, competing with TEL.

Taken together, the two cases show that in 2026 Tokyo Electron faces dual governance challenges: the “leakage judgment on the Taiwan side” and the “conflict of interests on the China side.” The Japanese headquarters subsequently announced high-level personnel changes, such as the chairperson at the Taiwan subsidiary, taking effect on February 1. The current final-ruling and removal actions can be viewed as follow-through of compliance-related reorganization. For the global semiconductor equipment industry, this case establishes a legal precedent that “cross-border equipment companies need to strictly isolate customer confidential information and competitor information.” If similar disputes arise again in the future, Taiwan courts have now built a foundation of precedents that can be cited.

This article “TSMC 2-nanometer insider leak finalized: former engineer sentenced to 10 years; Tokyo Electron fined 150 million NTD” first appeared on Lianxin News ABMedia.