LG Electronics executive indicted over damaged Samsung washers

Reuters News
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Posted: Feb 15, 2015 1:49 AM

By Se Young Lee

SEOUL (Reuters) - LG Electronics Inc's home appliances chief has been indicted on a charge of deliberately damaging Samsung Electronics Co Ltd washing machines, escalating the feud between South Korea's top consumer electronics companies.

A LG Electronics spokeswoman confirmed on Sunday that Jo Seong-jin and two other employees were indicted by local prosecutors. Samsung Electronics declined to comment and prosecutors could not be reached for comment.

The impending court case continues a run of disputes between the cross-town rivals. The two companies compete on several fronts, including televisions and home appliances, and have quarrelled publicly over issues such as refrigerator capacity and which of them has superior market share in air-conditioning.

The indictment against LG's appliances chief follows months of investigation. Samsung filed an official complaint in September, accusing Jo and other LG employees of deliberately damaging Samsung washers at retail stores in Germany.

LG had agreed to pay for what it called accidental damage to four machines after mediation by German authorities, but it couldn't resist taking a pot shot at the quality of its rival's products. Samsung railed against what is described as slanderous claims and filed its complaint.

"It is questionable whether there is sufficient evidence to prove that the president of a global company deliberately destroyed the machines where employees of the competing company were present," Ham Yoon-keun, a lawyer who will be defending Jo in court, said in a statement provided by LG. "The truth will be revealed in the courts."

Sources familiar with the matter told Reuters that representatives of Samsung Electronics and LG Electronics met recently in an unsuccessful attempt at mediation by prosecutors.

Separately on Sunday, Samsung Electronics subsidiary Samsung Display said that four of its employees were indicted on Friday on charges of stealing organic light-emitting diode (OLED) display panel technology from LG Electronics affiliate LG Display Co Ltd.

The Samsung Display employees have been accused of illegally obtaining the information from an LG Display contractor.

"Given that this information is one of LG Display’s business secrets, Samsung Display’s such action should obviously be considered as a theft," LG Display said in a statement.

Samsung Display said the indictment was excessive, arguing that the technology in question was already widely known.

(Additional reporting by Sohee Kim; Editing by Kim Coghill and David Goodman)