South Korea’s Kolon charged with trade secrets theft

According to Reuters (October 18, 2012):

Kolon and five company executives face charges that they stole trade secrets belonging to DuPont Co, maker of Kevlar fabric used in body armor and other products, and to Japan’s Teijin Ltd, maker of Twaron, a rival fabric.

What did they do, you ask?

“Kolon is accused of engaging in a massive industrial espionage campaign that allowed it to bring Heracron quickly to the market and compete directly with Kevlar,” said Neil MacBride, the chief U.S. prosecutor in the Eastern District of Virginia, in a statement.

And how did Kolon respond?

Kolon said it will vigorously defend itself against the charges from the U.S. Justice Department. The company said the fabric technology is four decades old and beyond the protection of DuPont’s patents.

“It is disturbing that the DOJ would bring charges that effectively assist DuPont in improperly extending its monopoly,” Kolon lawyer Jeff Randall said in a statement.

According to Bloomberg (October 19, 2012):

In March 2010, Michael Mitchell, who worked as an engineer and salesperson for more than 25 years at a DuPont-owned plant in Richmond, was sentenced to 18 months in prison after pleading guilty to giving Kevlar product data to Kolon.

Here is a video report of his conviction and some of the charges – including Dupont’s position.  Not only did he get 18 months but is also required to pay Dupont some $180,000.  According to The Blog of Legal Times:

Kolon, prosecutors said, sought secrets by hiring or attempting to hire current and former DuPont employees.

Mitchell, who was fired from DuPont in 2006, began working as a consultant for Kolon. Mitchell, charged with stealing DuPont secrets, cooperated with the government. He was sentenced in 2010 to an 18-month prison term. Mitchell is one of five consultants identified in charging documents.

According to the government, Mitchell in 2007 placed “numerous confidential DuPont business documents” on a laptop in preparation for a presentation at Kolon in South Korea. Prosecutors said Kolon obtained from Mitchell a document that detailed DuPont’s “capabilities and costs for the full line of its Kevlar products.” The information included production capacity, ingredient costs and profit margins.

Prosecutors said senior executives at Kolon and its parent company, Kolon Corp., participated in meetings “that reinforced the directives to obtain competitor technology” through consultants. Court papers reveal that Kolon paid three consultants, who were each former DuPont employees, more than $350,000 combined.

  • CactusMcHarris

    Considering that the company name is a variation of the minjok gastric system, is it any wonder things went to shit eventually?

  • jkitchstk

    Kolon Industries of Korea didn’t get the message for they’ve been banned for stealing, “because it used technology stolen from U.S. chemical giant DuPont” says Judge Robert Payne, at the Eastern District Court of Virginia.|home|newslist1
    “The jury awarded Dupont $919.9 million in damages for stealing trade secrets. Kolon has been preparing to appeal the ruling to avoid paying damages that are equivalent to about 70 percent of its total assets.
    Kolon’s Heracron is mainly used in making body armor, competing with DuPont’s trademarked synthetic fiber Kevlar, which the company developed and has sold since 1973. ”

    Kolon say what?

    “Kolon immediately released a statement yesterday, saying it will request a suspension of execution of the ruling.
    “We express deep regret about the global sales ban on Kolon’s Heracron by the U.S. court and will take stern measures,” the statement said. “The latest ruling lacks legitimacy both in terms of legality and factual relevancy.”
    Kolon’s lawyer, Jeff Randall, said DuPont was trying to block fair competition in the global aramid market through the lawsuit. He pointed out that the U.S. court unfairly excluded testimony of Kolon’s innocence, and said there were numerous procedural errors in the Virginia trial.
    The company also said there is no sufficient evidence proving Kolon stole information.”