News Column

U.S. Accuses Chinese of Stealing Trade Secrets

June 28, 2013
theft of wind turbine technology
Wind turbines (file photo)

A Chinese wind turbine maker was charged Thursday with stealing trade secrets from a U.S. firm, allegedly costing it more than $800 million, prosecutors said.

A federal grand jury in Wisconsin indicted Sinovel Wind Group Co., two of its employees and a former employee of a subsidiary of AMSC, a U.S. company formerly known as American Superconductor Inc., the U.S. Justice Department said in a release.

Along with Sinovel, the individuals charged are Su Liying, 36, deputy director of Sinovel's research and development department; Zhao Haichun, 33, a technology manager for Sinovel; and Dejan Karabasevic, 40, a former employee of AMSC Windtec, a wholly owned subsidiary of AMSC. Each are named on one count of conspiracy to commit trade secret theft, theft of trade secrets and wire fraud, federal prosecutors said.

"Today, we announce charges against Sinovel and three individuals for stealing proprietary wind turbine technology from AMSC in order to produce their own turbines powered by stolen intellectual property," Acting Assistant Attorney General Mythili Raman said. "This charged IP theft caused significant harm to a domestic company that develops cutting edge technology and employs Americans throughout the country."

U.S. Attorney John Vaudreuil called the alleged theft a "well-planned attack" that was "nothing short of attempted corporate homicide."

AMSC developed and sold software and equipment to regulate the flow of electricity from wind turbines to electrical grids. Sinovel purchased the software and equipment from the Wisconsin company for wind turbines Sinovel manufactured, sold and serviced.

The indictment charges that in March 2011, Sinovel owed AMSC more than $100 million for products and services previously delivered and had entered into contracts to purchase more than $700 million in products and services from AMSC in the future.

The indictment alleges the defendants conspired to obtain AMSC's copyright information and trade secrets in order to produce wind turbines and to retrofit existing wind turbines without having to pay AMSC for previously delivered products and services.

FBI Executive Assistant Director Richard McFeely said the case was "a classic example of the growing insider threat facing our nation's corporations and their intellectual property."

McFeely said that since 2008, the FBI's economic espionage arrests have doubled, while indictments have increased 500 percent and convictions are up 800 percent.




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Source: Copyright UPI 2013


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