Chinese Nat'l Gets 87 Months for Economic Espionage at Dow/Cargill
The Justice Department has announced that Kexue Huang, a Chinese national, was sentenced to 87 months in prison and three years of supervised release on charges of economic espionage from Dow AgroSciences LLC to benefit components of the Chinese government and theft of trade secrets from a second company, Cargill Inc.
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(See ITT's Online Archives 11101910 for summary of Huang's October 201 guilty plea to these charges.)
Worked on Proprietary Organic Insecticides at Dow AgroSciences
According to court documents, from January 2003 until February 2008, Huang was employed as a research scientist at Dow, a leading international agricultural company based in Indianapolis that provides agrochemical and biotechnology products. In 2005, Huang became a research leader for Dow in strain development related to unique, proprietary organic insecticides marketed worldwide.
As a Dow employee, Huang signed an agreement that outlined his obligations in handling confidential information, including trade secrets. The agreement prohibited him from disclosing any confidential information without Dow’s consent. Dow employed several layers of security to preserve and maintain confidentiality and to prevent unauthorized use or disclosure of its trade secrets.
Stole Trade Secrets to Compete with Dow in Chinese Pesticide Market, Etc.
Huang admitted that during his employment at Dow, he misappropriated several Dow trade secrets. According to plea documents, from 2007 to 2010, Huang transferred and delivered the stolen Dow trade secrets to individuals in Germany and China. With the assistance of these individuals, Huang used the stolen materials to conduct unauthorized research with the intent to benefit foreign universities that were tied to the Chinese government.
Huang also admitted that he pursued steps to develop and produce the misappropriated Dow trade secrets in China, including identifying manufacturing facilities in China that would allow him to compete directly with Dow in the established organic pesticide market.
Also Stole Cargill Trade Secret on Manufacture of New Food Product
According to court documents, after Huang left Dow, he was hired in March 2008 by Cargill, an international producer and marketer of food, agricultural, financial and industrial products and services. Huang worked as a biotechnologist for Cargill until July 2009 and signed a confidentiality agreement promising never to disclose any trade secrets or other confidential information of Cargill.
Huang admitted that during his employment with Cargill, he stole one of the company’s trade secrets -- a key component in the manufacture of a new food product, which he later disseminated to another person, specifically a student at Hunan Normal University in China.
Aggregated Loss of Huang's Conduct Between $7 - $20M
In the plea agreement, Huang admitted that the aggregated loss from the misappropriated trade secrets exceeds $7 million but is less than $20 million.