Korea's Prime Minister urges LG, SK to settle battery dispute
Prime Minister Chung Sye-kyun speaks at the start of an industry forum held in Mok-dong, southwestern Seoul, Thursday afternoon. Yonhap
By Kim Yoo-chul
A few weeks before the planned final ruling of the United States International Trade Commission (USITC) on the battery trade secrets dispute between LG Energy Solution and SK Innovation (SKI), a top Korean government official urged the two firms to settle the case.
“Simply, I can say you don't have to fight for small stakes. I hope the two companies settle the issue immediately and join forces for the global market. As far as I understand, U.S. politicians are hoping the companies will address the dispute at the earliest possible date,” Prime Minister Chung Sye-kyun said at an industry forum, Thursday.
The senior government official also added he directly approached top management of both LG Energy Solution and SKI and urged them to settle the case. “I told them to resolve the issue sometime soon. I've heard the two companies paid a few billion won in fees to attorneys. This is simply embarrassing,” Chung reportedly said.
He also mentioned that Chinese competitors would benefit a lot from the continued dispute between the two South Korean companies. This is the first time that a senior government official has mentioned the issue directly.
Since the beginning of the dispute, LG has been saying this is an issue between two private companies. But SK said the dispute would hurt President Moon Jae-in and his economic team's K-Battery Alliance initiative after Cheong Wa Dae identified batteries, biotech, the internet and games (BBIG) as the country's next growth engines.
The USITC is set to issue its final ruling Feb. 10 in the alleged misappropriation of trade secrets by SKI. In 2019, LG Chem filed a suit with the USITC accusing SKI of gaining illegal access to trade secrets by hiring LG Chem's former researchers. LG Chem has since spun off its battery business, founding LG Energy Solution in late 2020.
LG believes SKI used them in developing its battery technology, which led to it winning more orders from major car manufacturers. SKI denied the allegation, although the USITC issued a preliminary ruling in favor of LG saying SKI might have been involved in the destruction of documents, which was widespread throughout its organization.
Initially, LG thought to file a permanent injunction on SK products, but changed its stance toward seeking “proper compensation for the possible infringement” of its intellectual property. LG was asking SKI to pay a “few billion dollars,” while SKI was seeking to pay a “few million dollars,” according to sources directly involved with the issue.
Contacted by The Korea Times, senior LG and SK executives said the two companies don't want to see “the worst-case scenario.” In a press release after Chung's remarks on the matter, SKI said, “We feel very sorry to the public for not closing the case properly. We understand PM Chung's remarks as the public's wish for an end to the case. We will try to resolve the dispute through discussions and relevant efforts.”
In a separate statement, LG Energy Solution said, “We are on track to settle the case before the USITC's planned final ruling.”