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[Newsmaker] SK Innovation demands W1b from LG Chem in defamation countersuit

LG Chem expresses regrets, reiterates accusation that SK stole core technologies

On the heels of a lawsuit filed by LG Chem in the United States, SK Innovation sued its South Korean competitor for defamation in a local court, claiming 1 billion won in damages in a new chapter in the ongoing legal battle.

The country’s top energy business and newcomer to the lithium-ion battery market said Monday that it could no longer endure “groundless accusations” brought against it by rival LG Chem.

LG Chem, in response, said it feels “regret” over SK Innovation’s countersuit, reiterating its allegation that the battery arm of SK Group had stolen core technologies developed through years of research.

LG Chem sued SK Innovation on April 29 in a district court in the US state of Delaware and also filed a complaint with the US International Trade Commission, alleging misappropriation of trade secrets concerning manufacturing technologies for electric vehicle batteries.

The alleged theft of trade secrets involved SK Innovation hiring a total of 76 former LG Chem employees over the past two years, LG Chem claimed in its lawsuit.

On May 29, the USITC decided to launch an investigation into the claims and is currently examining the matter. It is scheduled to set a target date for the completion of its investigation in 45 days.

The countersuit was filed because SK Innovation believes LG Chem’s accusation lowers the value that SK Innovation brings to its employees, its customers, other businesses, the industrial ecosystem and the national interest, it said.

“The suit is the beginning of firm measures against the competitor’s groundless accusation,” said SK Innovation in a statement. 

SK Innovation CEO Kim Jun (SK Innovation)
SK Innovation CEO Kim Jun (SK Innovation)

Criticizing SK Innovation for being “too complacent” over the accusation of technology theft, LG said it had requested proof from SK Innovation on two occasions regarding the hiring of its former employees. The company didn’t receive any answer, it said.

The legal fight between the two firms is not the first. The two were involved in a similar lawsuit over patent infringement by SK Innovation into LG Chem’s lithium-ion battery separator technology in 2011. The companies reached a settlement after LG lost the suit in the first and second trials.

“The latest fight shows a similar pattern to the past suit that accused our company with no clear evidence other than circumstantial content,” SK Innovation said. “The company will claim 1 billion won in damages in the first hand, and will claim additional amounts by proving specific losses.”

According to the battery industry, the latest LG-SK fight was triggered by SK Innovation’s aggressive investments in its EV battery business by announcing construction plans of three new plants globally.

In late last year, SK Innovation won an order from German automaker Volkswagen to supply EV batteries for the carmaker’s new EVs slated for launch after 2022. LG Chem claimed some of its former employees who are now hired by SK had worked for LG’s Volkswagen project.

“Such legal fight might be viewed excessive and wasteful in a relatively small battery market,” said an industry insider. “As global carmakers are planning to mass-produce electric vehicles starting in the new few years, players would need to cooperate somehow in terms a desirable supply and demand.”

By Song Su-hyun (