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

Huntsman closing four pigment plants

March 5, 2015 3:36 pm ET

Huntsman Corp. is closing four plants — three in the U.S. and one in Germany — that make pigments for plastics and other markets.    More

Image

China lowers growth target

March 5, 2015 1:19 pm ET

The world's second largest economy has set its 2015 gross domestic product growth expectations at its lowest in a quarter of a century: 7 percent.    More

Image

'Listen to the Science' ads a start, but consumers still need education

March 5, 2015 11:36 am ET

Since joining Plastics News — and therefore learning more than the average consumer about the business and science of plastics — there...    More

Image

Mold maker Moldworx building in Arizona to bring in more molding

March 5, 2015 10:13 am ET

Moldworx LLC has begun leasing more space in Gilbert, Ariz., to allow it to grow its injection molding business.    More

Image

Bayer to stop MDI production in Brazil

March 4, 2015 9:21 am ET

Bayer AG's Bayer MaterialScience plans to stop production of MDI polyurethane at its plant near Rio de Janeiro in July, removing 55 metric tons per ye...    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