TSMC Takes Legal Action Against Employees for Leaked 2nm Chip Secrets

TSMC has taken legal action against several employees suspected of stealing trade secrets related to its advanced 2nm chip technology. The company confirmed that internal monitoring systems identified unusual activity, leading to the discovery of leaked data. The affected employees were terminated and are now facing legal proceedings, with some reportedly detained by authorities [1][2]. TSMC emphasized its strict policies against trade secret violations and reiterated its commitment to pursuing all legal avenues to address the breach [3].

The leaked information reportedly included sensitive details regarding the development and production of the 2nm chips, a technology that TSMC plans to begin mass production of later this year. While the company has not commented on whether this incident could delay the production timeline, it acknowledged that the data could pose risks to national security [1]. The Intellectual Property Division of the Supreme Prosecutors’ Office in Taiwan has also confirmed its involvement in the investigation, stating that the case constitutes a serious breach of the National Security Act [2].

TSMC’s CEO, C.C. Wei, previously highlighted the complexity of its chip technologies, noting that replicating them is extremely difficult due to the integration of both development and production knowledge. He also pointed out that only a few major firms—TSMC, Rapidus, Samsung, and Intel—are currently pursuing 2nm chip development [1]. This underscores the strategic importance of maintaining the confidentiality of such information.

The company has stated that its internal monitoring systems are designed to detect and respond to risks swiftly. TSMC also affirmed its cooperation with regulatory authorities to ensure the protection of its core technological assets and the interests of its employees [3]. The ongoing investigation is expected to determine the full extent of the leak, including whether other parties were involved or where the stolen data may have been sent [1].

This case has raised broader concerns about intellectual property protection in the semiconductor industry. Analysts note that such incidents are not uncommon in sectors where technological innovation is central to competitive advantage. TSMC’s decisive legal and disciplinary actions reflect a growing trend among firms to reinforce internal compliance and security measures in response to increasing threats from insider risks [2][3].

As the investigation continues, TSMC has not indicated any immediate operational disruptions or financial impacts from the alleged breach. However, the case highlights the vulnerability of sensitive data in a rapidly evolving digital landscape. The company’s firm stance may help reinforce stakeholder confidence by demonstrating a commitment to safeguarding its technological leadership and long-term strategic goals.

Sources:

[1] Focus

URL: https://focustaiwan.tw/society/202508050022

[2] The Register

URL: https://www.theregister.com/2025/08/05/tsmc_trade_secret_theft/

[3] AInvest

URL: https://www.ainvest.com/news/taiwan-semiconductor-employees-arrested-allegedly-stealing-trade-secrets-2508/

[4] Financial Times

URL: https://www.ft.com/content/ad9d7b68-3654-426d-90ea-332713a7b2c6