Cases We’re Watching

Case #1

Companies: DuPont and Pangang Group

Current Status: Open case in a Ninth Circuit Court

Synopsis: DuPont, an American chemicals company, owns a world-leading proprietary multi-stage process for producing titanium dioxide, a chemical responsible for the brilliant white of Oreo cream filling, automotive paint, and many more industrial applications. Walter Liew, a research engineer, conspired to steal the formula with DuPont chemical engineer, Robert Maegerle. Liew used thisinformation to win contracts worth $28 million from China’s Pangang Group to build a TiO2 production facility. Liew was convicted in 2014 and sentenced to 15 years in prison and more than $28 million in fines, Maegerle was sentenced to 2 ½ years. DuPont continues to pursue legal action against Pangang which claims immunity under the Foreign Sovereign Immunities Act, despite the statute’s commercial activity exemption. U.S. v. Pangang is being tried in the U.S. Court of Appeals for the Ninth Circuit.

Media Coverage:

1) Bloomberg: How a corporate spy swiped plans for DuPont’s billion-dollar color formula. February 4, 2014.

2) Courthouse News: Service Complicates DuPont’s Trade Secrets Beef Against Chinese Companies. June 13, 2018.

3) Law360: Chinese Co. Accused Of Espionage Tells 9th Circ. It’s Immune. February 27, 2020.

4) Law360: 9th Circ. Judge Doubts Co. Can Slip Charge It Stole DuPont IP. October 15, 2020.

Case #2

Companies: Huawei and T-Mobile

Current Status: New indictments filed in February of 2020

Synopsis: In 2014, T-Mobile invited two engineers with Huawei, a Chinese telecom company, to tour its labs in Seattle. The engineers took the visit as an opportunity to steal information and a piece of confidential equipment, Tappy the Robot. A Seattle court decided in 2017 that Huawei stole T-Mobile trade secrets and awarded the company $4.8 million in damages. In 2020, the US Department of Justice filed a series of lawsuits against Huawei, one of which accusing Huawei of stealing trade secrets and launching a formal bonus program rewarding employees for stealing trade secrets.

Media Coverage:

1) New York Times: T-Mobile Accuses Huawei of Theft from Laboratory. February 13, 2014.

2) Geek Wire: Jury sides with T-Mobile in federal lawsuit over theft of ‘Tappy’ robot technology by Huawei. May 17, 2017.

3) NPR: A Robot Named ‘Tappy’: Huawei Conspired To Steal T-Mobile’s Trade Secrets, Says DOJ. January 29, 2019.

4) Reuters: U.S. accuses Huawei of stealing trade secrets, assisting Iran. February 13, 2020.

Case #3

Companies: Avago Technologies, Skyworks Solutions and Tianjin University

Current Status: 1 of the 6 Perpetrators has been arrested and charged.

Synopsis: In 2015, six Chinese citizens were charged with stealing wireless communication technology from two American microchip manufacturers to launch their own company. The six Chinese citizens created a corporate espionage network while working and studying in the United States. Some began applying for patents on the stolen technology in 2010 on behalf of Tianjin University, a state-sponsored university in China. Avago Technologies, one of the victims of this intellectual property theft, spent 20 years and $50 million developing the technology that was stolen. One of the perpetrators was arrested in 2015 and was sentenced to 18 months in prison in 2020. The five others remain at large.

Media Coverage:

1) New York Times: 6 Chinese Men Indicted in Theft of Code From U.S. Tech Companies. May 19, 2015.

2) LA Times: Chinese professor accused of stealing tech secrets faces rare espionage trial. October 6, 2019.

3) InfoSecurity Magazine: Chinese Professor Jailed for Stealing US Trade Secrets. September 2, 2020.

Case #4

Companies: LG Chem and SK Innovation

Current Status: Decision expected December 2020

Synopsis: The US International Trade Commission is expected to make a decision in December regarding an intellectual property dispute between Korean battery manufacturer’s LG Chem and SK Innovation. The suit has been filed on the basis that SK stole trade secrets from LG Chem and used them to open a new plant in Commerce, Georgia which is scheduled to be complete in 2021.

This new $2.6 billion facility is expected to employ approximately 2,600 individuals and has already signed a deal to provide lithium-ion batteries for the Volkswagen electric SUV being built in neighboring Chattanooga, TN, and the new electric Ford F-150 pickup. In recent years, more than 100 LG Chem employees have left the company for SK, and according to a complaint filed the US International Trade Commission, those former employees are suspected to have stolen critical battery secrets.

Media Coverage:

1) Reuters: SK Innovation fuels LG Chem feud with EV battery patent lawsuit. August 29, 2019.

2) Korea Times: LG Chem gains edge over SK in battery battle. February 16, 2020.

3) Reuters: U.S. ITC delays decision on LG Chem, SK Innovation trade secret case. October 26, 2020.