Comment by rebootthesystem | Hacker News Reader

Comment by rebootthesystem | Hacker News Reader

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rebootthesystem

I had a business conflict with Samsung about a decade back. In the end, it cost us nearly a million dollars and probably many times more than that in opportunity cost.

I found them to be extremely dishonest and, by reason of sheer size, very aware of the fact that they are able to virtually exist above the law. What I mean by that is that they have no problem whatsoever throwing their weight and money around to cause so much damage that you'd rather take the abuse and the loss instead of fighting them.

In our case, they had one of their top three US executives blatantly lie in court. I could not believe it. This guy repeatedly lied under oath and his attorney (a Samsung attorney) did the same.

Could we have won? Absolutely. It would have required a million dollars cash (on top of the damage they caused my business) and probably two years of being buried under an intense legal campaign designed to cause damage at every possible turn.

Here's an example of what they did: They filed for a broad TRO (temporary restraining order) to keep us from talking to any of their competitors at a time when they breached a contract and discontinued components we designed into a line of products over a period of about ten months of work. Components the top Samsung executives in the US helped select and vouch for.

The TRO covered getting within a certain radius of a trade show attended by Samsung as well as every single one of their competitors. The radius was such that we couldn't even park a car within walking distance of the convention center, much less come in and go talk to alternative component sources. A few weeks later the judge who oversaw the TRO chewed-out the Samsung attorney for resorting to such a nasty destructive approach. Still, the damage was done. You'd have to fly all over Asia to see the people we could have seen in a couple of days at the conference.

So, yeah, I've seen one side of this beast and it's nasty. Nearly killed my manufacturing company. I don't generally think of large corporations as evil but in this case I could be convinced to make an exception.

Back in the '80s, when Korea was still a military dictatorship and Samsung was still run by its original founder, one of the founder's sons was recruiting me for some unusual (non-criminal) skills I had. He made it clear to his staff that he wanted me as one of his guys for special projects, and the way the somewhat militaristic Samsung guys kowtowed to me was truly creepy, even for dictatorship-era Korea. I was well aware that it wasn't about me but entirely about the founder's son. I was a pure symbol, inspiring fear and with no intrinsic value of my own whatsoever.

The founder died as this was happening, and I was quickly warned by some decent insiders that I should cease all contact with my benefactor and get away ASAP. The sons of the founder were going to fight for power and, as the Koreans say, "when whales fight, the shrimp's back gets broken". In a clash between the most powerful men in a military dictatorship, little people could have tragic "accidents", and so what? I took their advice.

The same family controls that company today. The guy just arrested is the nephew of my old "benefactor". The country is no longer a dictatorship, but the powerful people at the top haven't necessarily changed their ways. Every few years, there are accusations that the top Samsung people are guilty of bribery or similar manipulations. Hard to believe, right? They'll get charged, then the charges are dropped. They'll be convicted, then pardoned by the President. These are power struggles by people who are all above the law but not necessarily above one another. If you do business with them at the small, overseas, trivial level, this may not matter, but you should be aware that behind them you have a system that plays by older rules.

That's amazing.

My father had textile factories in South America. During the days of military regime it wasn't uncommon for him to receive visits from "the general" and a truck full of soldiers with automatic rifles. I was way too young to understand it, that's why I put it in quote. For all I know it could have been a mid-rank idiot but to me he looked like the general.

As my father tells tells the story, as power transitioned someone advised him to "evaporate". Since he had business in the US as well it wasn't that hard to pull-up anchor and legally emigrate for the last time. His businesses were usurped by whoever gained power and that was that. A lifetime of work gone "puff" virtually overnight.

These are aspects of life people in the US are not tuned into. We have a very linear environment when compared to some of what is daily life in other parts of the world.

Rule of law is(was?) precipitously absent in most South American countries. Only recently have things started to change. But its stories like these that scare away investors really and cause way too much hardship for the nation as a whole, down the line.

Something similar exists now in Russia and Venezuela, I imagine.

I read an article about a European business man doing business with a Russian company with ties to the government. The business man’s company produced high technology in some field. At one point in the negotiations, the Russians asked for a substantial discount. One that means taking a loss for the business man. To help their demand, the Russians showed the business man a series of photos of his wife and daughter, taken the very same morning. The business man got the message and agreed to the deal. And after it was done, understandably ceased to do business with Russians.

I've heard about an Israeli guy who started a mushroom-growing business in Russia. Something similar to this: https://www.youtube.com/watch?v=YcrCtVGEsZE At some point when it was starting to become successful, a gang of Russian criminals simply told him: "this is ours now", and that was that. Organized crime and corruption is a serious problem there.

I think rule of law as it is understood is mostly applicable to first world. E.g. countries like India may not have military dictators and all but deep corruption is way of life. It is not for lacking of laws but because for most of the population it is morally justifiable to take bribes, not pay taxes, jump traffic lights and so on.

Why is it morally ok? Because earth is a place of sin anyway and goal is to work towards going to heaven. This is done by performing religious duties. So 'rule of law' is either an inconvenience or irrelevant towards main goal of life.

> Why is it morally ok? Because earth is a place of sin anyway and goal is to work towards going to heaven. This is done by performing religious duties. So 'rule of law' is either an inconvenience or irrelevant towards main goal of life.

Heh. If you're smart enough, you can "morally" justify anything I guess. People living in the "mortal plane" do need to accept the laws that govern that plane though...or work to change them if they are not acceptable.

Being Korean I recognize the progeny of your name ;). Thanks for the nice anecdote, and I really enjoy your writing style. Do you have other writing/channels elsewhere?

What a great story. You should write a blog post. ;)

Lee Chang Hee and Lee Meng Hee were the other two sons of the founder, but they had already been written off long before 1980s, and had no part in Samsung operations by then. So I'm not sure if either them of was your benefactor. Now I'm curious.

Or a book. :)

Care to elaborate what your unusual (non-criminal) skills are ?

But if you don't want to talk about it that's fine. I am just nosey.

> These are power struggles by people who are all above the law but not necessarily above one another.

This is an interesting thought. Thanks. Good post.

Every multinational behaves this way in court. Their lawyers have zero compunction pushing these blatantly farcical narratives about how badly the company is damaged by the most minor alleged infractions, asking for the moon and the stars, and judges actually granting it. "Big companies bully" is a truism of corporate law; in fact, for many, this bullying plays a large role in their ability to hang on to their power.

Small innovators are the victims of this country's convoluted civil law system many times each day. I 100% believe that we are decades behind in technological progress because of the perverse combination of corporate shills in Congress, massively pro-corporate media preventing salient discussion on these points from entering the public dialogue (preferring instead to inflame people on identity politics or intractable social issues), and a lot of judges with a strong bias to believe anything a recognizable entity says when it's competing against a less-recognizable entity.

It sucks that it happened to you, but Samsung turning back on its partners is a known tactic in SK. The sad part is Samsung is probably not the worst of the bunch in that country.

My father was a "Samsung Man". That's actually a term that all Koreans know, and it used to be a badge of honor, especially in the 70s and 80s.

Samsung used to take care of its employees well, paying great bonus, and giving its strong performers a piece of (or whole) sub-contracting business as retirement gift.

Those were the old days.

Now, all you hear are their brutal and sleazy business dealings a real shame considering they are 100x wealthier than when they were at the most generous.

So sleaze bags get more wealth...

What's more important, wealth or your reputation?

With enough wealth, you get to buy reputation. So you tell me, which is more important?

Heh, that made me think of a certain software developer and have a small chuckle.

My uncle was a lawyer on the other side of a legal dispute involving Daewoo in the 1990s. All the Korean chaebols operate similarly. (He’s a badass and bopped them in court though.)

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