White House Aims At Trade Secret Theft

Chemical manufacturers are welcoming a new White House initiative to fight the growing theft by China and other countries of trade secrets from U.S. companies.

The strategy, unveiled late last month, includes applying more diplomatic pressure, increasing investigations and prosecutions by U.S. law enforcement, and weighing whether new legislation is needed.

White House officials cited intellectual property theft from Dow Chemical and DuPont among several cases that they used to highlight the extent of the problem. “We will act vigorously to combat the theft of U.S. trade secrets that could be used by foreign companies or governments to gain an unfair economic advantage,” said Victoria A. Espinel, the U.S. intellectual property enforcement coordinator, at an Administration event.

Attorney General Eric H. Holder Jr. added that data theft is “a significant and steadily increasing threat to America’s economy and national security interests.”

The White House issued a summary of economic espionage and trade-secret criminal cases the Justice Department has pursued over the past four years.

One example cited is the 2011 conviction of former Dow researcher Wen Chyu Liu for conspiring to steal trade secrets related to Dow’s process for making chlorinated polyethylene and selling them to firms in China.

Dow says it welcomes the Administration’s focus on the heightened risk of trade-secret theft in a global economy. “We support an approach that promotes voluntary, industry-led best practices to protect trade secrets. Dow will actively participate with the chemical industry and the government in this endeavor.”

The White House summary also highlights an unfolding case that involves a Chinese state-owned enterprise and five individuals, including two former DuPont employees, who are accused of conspiring to steal trade secrets about titanium dioxide technology from DuPont.

One of the individuals, former DuPont engineer Tze Chao, pleaded guilty in federal court last year to conspiracy to commit economic espionage.

DuPont tells C&EN that it has “ongoing communications with the federal government regarding intellectual property issues, and we seek their assistance as needed in order to ensure the protection of our proprietary technology.”