Chinese National Pleads Guilty to Economic Espionage

Oct 18, 2011 7:22pm

A Chinese national has pleaded guilty to economic espionage for providing trade secrets from agricultural firms Dow and Cargill to the Chinese government.

Kexue Huang, pleaded guilty to one charge of economic espionage before a federal judge in Indiana, admitting that while he worked at Dow AgroSciences LLC and Cargill he obtained and transferred to China trade secrets from the companies. Huang was arrested and charged in an indictment in July 2010.

Huang worked for Dow from January 2003 to February 2008 and conducted research on an organic insecticide that was being developed by the company. The plea agreement filed in federal court in Indiana today asserted that between 2007 and 2010, Huang provided the Dow trade secrets to two people working for the Chinese government.

The court papers note that one of the unindicted co-conspirators was a Chinese exchange student studying at the Technical University in Dresden, Germany, who later moved to the Hunan Normal University in China.

“In stealing, transferring and using the trade secrets, Kexue Huang, a/k/a ‘John,’ intended to benefit Hunan Normal University, the national Natural Science Foundation and the 863 Program. Each of these entities is a foreign instrumentality of the People’s Republic of China,” the plea agreement said.

Program 863 is known as the “National High Technology Research and Development Program of China,” according to the indictment.

After working for Dow, Huang worked for Cargill and stole information relating to genetic information for enzymes used by the agricultural company.  Court papers unsealed today in Minnesota revealed the theft of trade secrets at Cargill.  The plea agreement estimates that Huang cost the two companies $7 million to $20 million in damages.

“We cannot allow U.S. citizens or foreign nationals to hand sensitive business information over to competitors in other countries, and we will continue our vigorous criminal enforcement of economic espionage and trade secret laws,” Lanny  Breuer head of the Justice Department’s Criminal Division said in a statement. ” These crimes present a danger to the U.S. economy and jeopardize our nation’s leadership in innovation.”

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