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September 22, 2011

Scientist Admits Trade Secret Theft

Industrial Espionage: Plea deal, if accepted by court, will avoid a trial for former Dow researcher

Marc S. Reisch

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Former Dow AgroSciences scientist Kexue Huang has agreed to plead guilty to two counts of stealing trade secrets from Dow Chemical and the agribusiness company Cargill.

If a federal judge in Indianapolis accepts the deal between Huang and federal prosecutors at a hearing on Oct. 18, Huang will avoid a trial scheduled for the end of October. He could receive up to 15 years in prison and a $500,000 fine on one count and 10 years and another $500,000 fine on the second count.

Huang, 46, worked for Dow between 2003 and 2008. He was first arrested by the FBI in July 2010 on charges that he stole information related to the biosynthesis of Dow’s Spinosad brand spinosyn insecticide ( C&EN, July 26, 2010, page 9).

According to the plea deal, while he was employed by Dow, Huang applied for funding from the National Natural Sciences Foundation of China. He then used the money to direct R&D at Hunan Normal University on some of the same spinosyn-related technology he had researched for Dow. He also sent spinosyn material to a university scientist.

In the plea deal, Huang also admits to stealing an enzyme under development for a new food product from Cargill, which is identified in court documents as Company A. Huang sent the DNA sequence of the enzyme to a student he was mentoring in China.

A Cargill spokeswoman tells C&EN that Huang worked for the firm between 2008 and 2009. She adds that Cargill cooperated with the FBI and the U.S. attorney’s office in pressing the case against him.

Dow has had problems with industrial espionage before. In February, a federal jury in Baton Rouge, La., convicted Dow researcher Wen Chyu Liu of stealing trade secrets pertaining to the elastomer chlorinated polyethylene and selling them to Chinese firms.

Chemical & Engineering News
ISSN 0009-2347
Copyright © 2011 American Chemical Society
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