South Korean Supreme Court Upholds Trade Secret Verdict Against Dark and Darker Developer

South Korea's Supreme Court has finalized a ruling ordering game developer Ironmace and its founders to pay approximately $4.2 million in damages to Nexon, one of the country's largest game publishers. The April 30, 2026, decision ends a five-year legal battle over allegations that former Nexon employees took proprietary source code and game development materials with them when they left the company to create the hit dungeon-crawling game Dark and Darker. For business owners who rely on proprietary software, technology, or creative processes, the case offers a clear warning about the risks of employee departures and the importance of protecting trade secrets before they walk out the door.

From Internal Project to Competing Product

The dispute began in 2021, when Nexon filed suit alleging that a former team leader on an unreleased internal project known as "P3" transferred core game data to a personal server before resigning to found Ironmace. Nexon claimed that the development materials he took, including source code and build files, formed the foundation of Dark and Darker, which became a breakout hit in the gaming community. A lower court sided with Nexon, finding that the materials qualified as protected trade secrets and that their unauthorized use constituted misappropriation. An appeals court affirmed the finding and set the damages award at approximately 5.76 billion Korean won. The Supreme Court upheld those rulings in full, bringing the matter to a close.

Source Code as a Protected Trade Secret

One of the most significant aspects of the decision is the court's treatment of source code and game build files as protectable trade secrets. Notably, Nexon's copyright infringement claims were dismissed at every level because the courts found insufficient evidence that Dark and Darker directly copied Nexon's code. However, the courts found that the proprietary methods, tools, and workflows embedded in the source code qualified as trade secrets worthy of legal protection. This distinction matters for any business that develops software or technology. Even when a former employee does not copy your product line for line, the underlying processes and know-how that went into building it can still be legally protected.

Key Takeaway for Business Owners

This case reinforces a principle that applies across every industry: when employees leave your company, your trade secrets should stay behind. Businesses that develop proprietary software, technology, or processes need strong protections in place before a departure happens, not after. That starts with well-drafted employment agreements that clearly define what information is confidential and what restrictions apply when an employee exits. It also means implementing technical safeguards, such as access controls, activity monitoring, and data transfer restrictions, that limit the ability of departing employees to take sensitive materials with them.

Equally important is acting quickly when you suspect misappropriation has occurred. Nexon filed suit promptly and was able to trace the data transfers that supported its claims. Businesses that delay or fail to monitor employee activity during the departure process risk losing the evidence they need to prove a trade secret case in court.

Want to learn more about protecting your trade secrets when employees leave? Schedule a free consultation with Diorio IP Law Group to discuss your options.