LG Electronics Inspected Over Washing Machine Dispute

LG Electronics
LG Electronics headquarters and factory in Seoul and South Gyeongnam Province, respectively, have been searched and inspected on Friday by South Korean authorities as part of their investigation over its washing machine dispute with Samsung Electronics. The officials wanted to check if the workers in LG intentionally damaged Samsung washing machines. The competition between two South Korean tech titans Samsung and LG has gone far.

It started during the IFA 2014 which was from September 5 to 10 in Germany, when executives from LG dropped by a store and allegedly broke a Samsung-made washing machine. The Crystal Blue washing machine’s door was then impossible to properly close since the door was damaged. The LG people paid the store for the damaged machine, but problems surfaced again when there were more damaged units found.

Samsung claimed that LG people damaged three washing machines in a store in Steglitz and two at a Saturn store in Europa Center. It believed the LG officials deliberately broke the products from those two stores, which are about six-kilometer distance from each other and within 15 minutes drive.

LG denied the allegations strongly, saying it is just normal for any company to check on the products of their rival, especially during trips overseas, but they do not have any idea why five Samsung washing machines were impaired. LG hinted those damaged washing machines were perhaps weaker or not strong enough. However, Samsung reported the LG people to the Seoul Central District Prosecutor’s Office and filed a case against the company for business obstruction, property damages and defamation. It likewise accused LG for slanderous claims that their washing machines were defective.

Samsung said Jo Seong-jin, LG appliance head and other executives are involved in the sabotage. According to the former, surveillance video footage shows LG executives destroying the door hinges of the washing machines. Before LG Electronics was inspected over the washing machine dispute, it counter-sued Samsung on December 12, with claims of defamation and tampering of evidence.

The LG appliance boss is currently imposed with a travel ban, as he failed to comply to many requests for investigations. LG said he can comply only after the Consumer Electronics Show event in Las Vegas, and requested the prosecutors temporarily waive the travel ban. However, the lifting of the travel ban has not happened, and CES 2015 is nearing as it is set on the first week of January.

Samsung Electronics is a South Korean firm which produces products and is a global leader of flat-screen TVs and mobile devices, specifically the Galaxy line of smartphones and phablets. On the other hand, its competitor LG Electronics from the same country is among the world’s biggest home appliance manufacturers. Aside from known washing machines and refrigerators bearing its brand, LG has also built its name in the tech world for its lineup of smartphones.

When LG Electronics’ headquarters and factory were inspected last Friday over the washing machine dispute, officials reportedly seized documents and hard drives of those who attended the IFA tradeshow with Jo. According to LG, they were raided because of unilateral and excessive complaints about a rival company. They are worried that these could damage their credibility and activities.

By Judith Aparri

Business Korea

Photo courtesy of LG Electronics – Flickr License

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