South Korea's Kolon accused of stealing trade secrets

By Frank Esposito
Senior Staff Reporter

Published: October 19, 2012 6:00 am ET

Related to this story

Topics Public Policy, Materials, Suppliers

WASHINGTON (UPDATED Oct. 19, 12:10 p.m. ET) — South Korean chemicals firm Kolon Industries Inc. and five of its employees have been indicted by the U.S. Department of Justice for allegedly stealing trade secrets related to DuPont Co.’s Kevlar material and to a similar product made by Teijin Ltd.

The indictments come a little more than a year after DuPont was awarded almost $920 million in a related trade-secrets lawsuit against Seoul-based Kolon. Kolon allegedly obtained confidential information about production of DuPont’s Kevlar-brand and Teijin’s Twaron-brand para-aramid fibers between 2002 and 2009 from former employees of both firms, Justice Department officials said in an Oct. 18 news release. Kolon then used this information to produce its own Heracron-brand para-amid fibers.

“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,” U.S. Attorney Neil MacBride said in the release.

Assistant Attorney General Lanny Breuer added in the release that “by allegedly conspiring to steal DuPont’s and Teijin’s intellectual property, Kolon threatened to undermine an economic engine at both companies.”

In an Oct. 18 statement from Wilmington, Del.-based DuPont, Senior Vice President and general counsel Thomas Sager said the firm “believes in a fair and level playing field, and will remain vigilant in protecting and enforcing our trade secrets.”

“Today’s announcement of the indictment speaks for itself and constitutes a major step in bringing this matter to a conclusion,” Sager said. “We will continue to pursue enforcement of our civil judgment in the United States, Korea and around the world.”

In one of the incidents, Kolon employees met with a DuPont employee at a hotel in Richmond, Va., in 2008 to discuss how the DuPont employee could provide Kevlar-related trade secrets without leaving evidence. In a separate incident, a Kolon employee copied information from a CD owned by a former DuPont employee who was working as a consultant to Kolon. The CD contained a detailed breakdown of DuPont’s capabilities and costs for its Kevlar products, customer pricing information and related data.

The indictments were filed in U.S. District Court in Washington. The indicted Kolon employees are Jong-Hyun Choi, 56; In-Sik Han, 50; Kyeong-Hwan Rho, 47; Young-Soo Seo, 48; and Ju-Wan Kim, 40.

The indictment seeks at least $225 million in forfeiture — representing what Kolon profited from Heracron sales from January 2006 through June 2012 — as well as $341,000 in payments made to former DuPont employees in exchange for trade-secret information.

Officials with Kolon and with Osaka, Japan-based Teijin could not be reached for comment. Teijin has a sales office in Atlanta, while Kolon operates its API-Kolon distribution unit in the Chicago area.


Comments

South Korea's Kolon accused of stealing trade secrets

By Frank Esposito
Senior Staff Reporter

Published: October 19, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Polypropylene prices rise, while PE and PS fall

February 26, 2015 4:01 pm ET

North American prices for polyethylene and polystyrene resins continued to fall in February, while regional prices for polypropylene showed a...    More

Image

NFM Welding Engineers opens direct office in China

February 26, 2015 2:05 pm ET

MASSILLON, OHIO — Extrusion equipment manufacturer NFM Welding Engineers Inc. has opened a sales office in Dalian, China.    More

Image

Price and sustainability both key to success for carpet recycler

February 26, 2015 1:28 pm ET

DALLAS — A green message will get you in the door, but ultimately that sustainability message has to be backed up with quality at the right...    More

Image

3i to sell specialty chemicals company Azelis to Apax Partners

February 26, 2015 11:36 am ET

Azelis Holding SA, the specialty chemicals distributor, is being sold by its private equity owners 3i Group plc to another private investment outfit, ...    More

Image

Expert says more action needed to solve ocean plastics problem

February 25, 2015 5:59 pm ET

DALLAS — Private companies are going to have to step up to the plate and open their wallets if the world ever wants to solve the growing problem...    More

Market Reports

Flexible Packaging Trends in North America

North America represents about 30 percent of the global consumption of flexible packaging. Annual growth in this region is forecast at 4 percent during the next 5 years.

For more insight on growth opportunities, drivers of growth and the outlook for 2015, download this report.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 billion plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Upcoming Plastics News Events

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events