2017Do18176 A. Violation of the Unfair Competition Prevention and Trade Secret Protection Act (Decree)

Disclosure of Business Secrets, etc.

B. Occupational breach of trust

1. A.

2.(a) B

3.(a)(b) C

4.(a) Co., Ltd. D

Defendant C and Prosecutor

Law Firm LLC (Defendant A, B, and D)

Attorney Hong-tae, Kim Jong-tae, Kim Il-tae, Cho Il-il, Cho Chang-chul, Kim Chang-hwan, and Mari-gu

Law Firm Barun (for Defendant C)

Attorney Jeon Byung-chul, Attorneys Lee Jin-hoon, Lee Jin-ju

Seoul High Court Decision 2017No2052 Decided October 20, 2017

January 17, 2019

All appeals are dismissed.

The grounds of appeal are examined.

1. As to the grounds of appeal by the prosecutor on Defendant A and B

A. As to the assertion of misapprehension of the legal principle as to the commencement of enforcement

(1) In the crime of unlawful use of trade secrets under Article 18(2) of the former Unfair Competition Prevention and Trade Secret Protection Act (amended by Act No. 13081, Jan. 28, 2015; hereinafter referred to as the "former Unfair Competition Prevention Act"), where the use of trade secrets is directly or indirectly used for business activities by using it for production, sale, etc. of goods or for research, development, etc. according to the original purpose of use of trade secrets (see, e.g., Supreme Court Decisions 98Da1928, Jun. 9, 1998; 2008Do9433, Oct. 15, 2009); if an actor intended to use or utilize it for business activities related to the trade secrets in close vicinity of the business activities (where the trade secrets are in the form of electronic waves, the act of performing the relevant electromagnetic waves beyond the storage phase), the act of unlawful use of trade secrets can be deemed to have commenced, such as commencing the crime of unlawful use of trade secrets (see, 3009Do939.

(2) The court below found that the original purpose of this case's information was to be used by E, F, and G Co., Ltd. 17 regional Mayors/Do Governors (the head of a metropolitan organization) and the superintendent of education on the 6th nationwide local election throughout the country (hereinafter referred to as "the result of the prediction and investigation of this case") was to inform viewers through broadcasting after the completion of the local election. Furthermore, the court below determined that Defendant A and B could not clearly know whether Defendant D (hereinafter referred to as "Defendant D")'s information of this case was identical with the result of the prediction and investigation. The court below determined that the above entry of Defendant A and B's aforementioned input cannot be deemed to have started to be an unlawful use of trade secrets, and that the above Defendants' entry of this case's information could not be seen to have started from 17 regional Mayors/Do Governors, Do Governors, and 2 across the country, which are part of the result of the prediction and investigation of this case. The court below confirmed that the aforementioned Defendants' entry of this case's information in order from 3080 terrestrial broadcasting companies.

Examining the reasoning of the lower judgment in light of the aforementioned legal doctrine, the evidence duly admitted, and the record, the lower court’s determination is justifiable. In so determining, contrary to what is alleged in the grounds of appeal, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules

B. As to the assertion of misapprehension of the legal principle as to non-public relations

(1) The term "trade secret" under Article 2 subparagraph 2 of the former Unfair Competition Prevention Act means any technical or operational information useful for production methods, sale methods, and other business activities, which is kept confidential by considerable effort. The term "not known to the public" means that the information is not known among those who are likely to obtain economic benefits by being engaged in the same industry, such as those who are in the same industry (see, e.g., Supreme Court Decision 2006Do8278, Jul. 10, 2008). Since the information is not known to many and unspecified persons, such as the publication, etc. because it is not known to the public, it can be deemed that it is not known to the public if it is ordinarily impossible to obtain such information without going through the holder.

(See Supreme Court Decisions 2006Do7916 Decided July 9, 2009; 2016Do10389 Decided January 25, 2017, etc.)

(2) The lower court determined that it is difficult to view the instant information as a single or indivisible combination of the information with the candidates 1, 2, and the estimated profit ratio, etc. for each of the 17 Mayors/Do Governors nationwide. The information appears to have been known among many unspecified persons engaged in other mass media than terrestrial three companies, and at least once the information about individual candidates is broadcasted and disclosed through one broadcasting company among the terrestrial three companies after the completion of voting, the relevant part was known to many unspecified persons. Accordingly, the lower court determined that it was difficult to view that Defendant A and B were used trade secrets by using the publicly known information in sequence from around 18:00 to 49 on June 4, 2014, on the ground that it was difficult to view that Defendant A and B broadcast the information publicly known as above.

Examining the reasoning of the lower judgment in light of the aforementioned legal doctrine, the evidence duly admitted, and the record, the lower court’s aforementioned determination is justifiable, and contrary to what is alleged in the grounds of appeal, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal doctrine

C. As to the assertion of misapprehension of the legal principle on confidentiality

(1) Article 2 subparagraph 2 of the former Unfair Competition Prevention Act provides that "a trade secret shall be kept confidential by considerable effort," the information is objectively maintained and managed as confidential, such as making or notifying a mark or notification that can be perceived as confidential, imposing restrictions on the access to the information or imposing a duty to keep confidential on the access to the information.

The term “state” refers to the state in which facts are recognizable (see, e.g., Supreme Court Decisions 2008Do3435, Jul. 10, 2008; 2016Do10389, Jan. 25, 2017).

(2) On June 4, 2014, after the end of voting, the lower court determined that the instant information cannot be deemed to have been maintained and managed as confidential any more after 18:00, on the ground that there was no circumstance to deem that there was no reason to believe that the duty of confidentiality was imposed on the results of the instant forecast investigation between the terrestrial three companies, or that there was no reason to recognize that the terrestrial three companies managed the instant information as confidential.

Examining the reasoning of the lower judgment in light of the aforementioned legal doctrine, the evidence duly admitted and the record, the lower court’s aforementioned determination is justifiable. In so doing, contrary to what is alleged in the grounds of appeal, the lower court did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules

2. As to the prosecutor's ground of appeal on Defendant D

The lower court determined that Defendant D, an employee of Defendant D, did not constitute a crime of violating the Unfair Competition Prevention Act, such as the revised facts charged at the lower court, and sentenced Defendant D not guilty.

Examining the reasoning of the lower judgment in light of the aforementioned relevant legal principles and records, the lower court’s aforementioned determination is acceptable. Contrary to what is alleged in the grounds of appeal, the lower court did not err by misapprehending the legal doctrine regarding trade secrets under the former Unfair Competition Prevention Act and the corporation’s considerable attention and supervision under joint penal provisions, or by exceeding

3. As to the Prosecutor’s appeal against Defendant C

The prosecutor submitted a written appeal to the effect that he/she is dissatisfied with the defendant C's violation of the Unfair Competition Prevention Act among the judgment below, but there is no specific ground for appeal as to this part.

4. As to Defendant C’s ground of appeal

According to the reasoning of the judgment below, the court below reversed the judgment of the court of first instance which acquitted Defendant C of this part of the facts charged, and found Defendant C guilty, on the grounds as stated in its reasoning, on the part of occupational breach of trust against Defendant C in violation of its duties.

In light of the relevant legal principles and records, the above judgment of the court below is just. Contrary to the allegations in the grounds of appeal, the court below did not err by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules, or by misapprehending the legal principles on property damage and intentional breach of trust, etc.

5. Conclusion

Therefore, all appeals are dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim Jae-sik, Counsel for the defendant

Justices Cho Jong-hee

Justices Min Min-young

The chief Justice Justice shall mobilized