[미디어SR 정혜원 기자] Prime Minister Jeong Sye-gyun expressed concern over a battery lawsuit between LG Energy Solutions and SK Innovation because of the decline in Korean battery competitiveness.
Prime Minister Jeong Sye-gyun said at the Broadcast Reporters Club Invitational Debate held at the Korean Artists Center in Yangcheon-gu, Seoul on the 28th, “The future of K-battery will be really big in the future. I want to create a situation that is proactive,” he criticized.
Prime Minister Chung added, “It is said that the litigation costs alone amount to hundreds of billions of billions of dollars. It is not only economical, but when the two companies fight, they only do good things.”
Prime Minister Jung particularly commented, “I talked to the chief executives of both companies, met and asked me to solve it quickly, saying,’Isn’t it embarrassing, is it because I’m causing concern to the people?’ He also expressed his feelings.
It is evaluated that it is unusual for a high-ranking government official to express this position in a lawsuit between companies.
An official from the Ministry of Trade, Industry and Energy said to the media SR on the day that “if both companies hope and the situation arises, it seems that the government should of course play a mediation role.”
The government has refrained from intervening by giving priority to the position of’work between individual companies’ in regards to litigation between key companies.
However, Prime Minister Chung’s remarks on this day are interpreted as expressing a strong will by the government to maintain its position as a’K-battery’ against China, Japan, Europe, and the United States, respectively, to grow their own companies.
This is because the market dominance of electric vehicles with less carbon emissions compared to existing internal combustion locomotives is predicted to increase significantly to cope with Corona 19 and worsening climate change.
However, while there is an opinion that companies should solve their own work, on the other hand, criticism that the government is on the lookout is subtly confronting the criticism that the government is on the lookout even though a representative company that needs to foster the food industry in the future is bleeding in litigation.
◆Both companies immediately asked for admission, but they were still unwilling
In this regard, both companies have expressed their stance, but the two sides still differ in view of the negotiations before reaching an agreement.
On the same day, SK Innovation said in a statement in the name of the CEO of the battery business division, Ji Dong-seop. “We will do our best to resolve them smoothly through collaborative and constructive dialogue efforts with the counterpart of the dispute.”
However, while LG Energy Solutions expressed its position, “We are doing our best to reach an agreement and will actively work to solve problems smoothly”, “However, until recently, SK Innovation’s proposal did not have any willingness to negotiate. But I look forward to any suggestions to discuss.”
Last year, LG Chem put forward a standard that “the two companies can negotiate an agreement before the final decision of the US International Trade Commission (ITC), and this must be agreed between the two sides at a reasonable level based on objective grounds.”
ITC’s final ruling is scheduled for the 10th of next month.
◆It’s been the third year of the lawsuit this year…
The three-year lawsuit between LG Energy Solution and SK Innovation began in April of last year when LG Energy Solution (at the time, LG Chem) alleged infringement of SK Innovation’s trade secrets.
LG is arguing that SK Innovation infringed on its trade secrets by stealing information such as battery research and manufacturing while taking out LG Chem employees on a large scale.
The US International Trade Commission (ITC) issued a ruling against SK Innovation’s early defeat in February last year.
SK Innovation accepted LG Chem’s claim that it did not follow the court’s forensic order and systematically destroyed the evidence. At that time, there were prospects suggesting the possibility of an agreement, saying that LG Chem had a victory.
However, ITC accepted the opposition from SK Innovation in April and conducted a full review of the existing early defeat ruling.
As a result, prediction became difficult, and the final ruling was postponed three times in a row due to Corona 19. That is why there are concerns that uncertainty is growing and the burden of litigation between the two companies is increasing.
LG Energy Solution confirmed that SK Innovation removed over 100 key personnel from all fields, including battery research and production, for two years from 2017, and they downloaded from 400 to 1,900 core technology-related documents during the turnover process. I said I did.
An official from LG said to Media SR, “Since Vice Chairman Shin Hak-cheol has led several ICT litigation cases at 3M, he started the lawsuit under the judgment that there was a problem based on his experience.” “(LG) Criticized that the other side (SK Innovation) scouted key personnel for several tens of billions of dollars and approached it in a way of’don’t put your hand on and blow your nose.’”
The official also pointed out that in the long run, if (SK Innovation) makes similar products cheaper (without R&D investment), this will result in a decrease in margin due to unit price competition, affecting not only sales but also employment.” .
On the other hand, SK Innovation is refuting that there was no reason to infringe trade secrets. SK is reiterating that it is unfair to say that the battery technology and production method of the two companies are different, and that SK Innovation’s core technology is already the world’s best. In addition, the position that LG Chem’s employee turnover at the time was also voluntarily resolved.
◆ITC President’s direct organization…President’s right to refuse
The position of the Biden administration, which was launched this year, also seems to be difficult. If ITC decides to lose SK Innovation, the ban on imports of SK Innovation battery products into the US will take effect.
Products that violate trade secrets, namely related parts and materials such as battery cells and modules, are also banned from importing into the United States, making it virtually impossible to produce batteries in the United States.
There is also an analysis that public opinion acts as a burden on the ITC committee. Reuters reported that if ITC makes a decision unfavorable to SK Innovation last year, the ban on imports of batteries and necessary parts could disrupt the business of Volkswagen and Ford, which are developing new cars.
SK Innovation is building batteries in Georgia and has even announced plans for expansion. It is known that there is public opinion that such a plan should be considered as it is expected to have a positive effect on the stagnant economy in the United States.
ITC is an independent federal quasi-judicial agency directly under the U.S. President that investigates, analyzes, and regulates trade issues and unfair trade practices.At the time of “review” in April last year, the conditions of competition between public health and welfare and the U.S. economy It was also mentioned that the judgment would be made in consideration of the’public interest’ related to consumers.
If the ITC makes a final decision and notifies President Biden of this, the president can exercise his veto on the basis of’policy judgment’ within 60 days. However, so far only one case has been rejected by the US president of the ITC.