Convictions for Trade Secret Sales a 'Shot Heard Around the World'

Good Morning America

The conviction of two men for conspiring to sell whitening-chemical trade secrets to China “was a shot heard around the world,” a former federal prosecutor told "Good Morning America."

"This was a very important case for the U.S. government to bring," Stanley L. Friedman said. "It's a message to foreign countries they can't spy on the U.S."

The conviction by a federal jury in San Francisco this week centered on trade secrets at E.I. du Pont de Nemours & Co., whose headquarters is in Delaware.

DuPont's chloride-route titanium dioxide, or TiO2, is a "valuable" white pigment that has been used in materials such as paints, plastics and paper, the government's indictment states. A similar chemical reportedly is used in the creamy filling of Oreo cookies, but DuPont says its product is not used in food.

The jury found Walter Lian-Heen Liew and Robert Maegerle guilty of conspiring to steal trade secrets from DuPont regarding its titanium dioxide technology and sold those secrets for "large sums of money," allegedly more than $20 million in total, to state-owned companies of the People's Republic of China, the FBI said.

Since DuPont developed the use of the chemical in the 1940s, the company accounts for about one-fifth of all global TiO2 sales, the indictment said. The world's largest producer of TiO2 pigment manufactures it at plants in the United States, Mexico and Taiwan.

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A spokeswoman for Mondelez International, which owns Oreo and is based in Deerfield, Ill., said the company is "aware of this case and the important efforts by the FBI and U.S. Justice Department to defend against and prosecute those who engage in economic espionage activities."

"Having said that, as a matter of course, we don’t share specifics on our product formulas," according to a statement from Laurie M. Guzzinati, regional director, corporate and government affairs for Mondelez in North America. "All of our products meet regulatory guidelines in the countries where they are sold."

"The verdict underscores the consequences faced by those who steal trade secrets, and we appreciate the efforts of the DOJ and the FBI," DuPont spokesman Dan Turner said. "DuPont will continue to take aggressive steps to preserve our technological edge, including cooperating with governments and law enforcement agencies around the world."

Editor’s Note: An earlier version of this story incorrectly reported that E.I. du Pont de Nemours & Co.’s chemical TiO2, which is at the center of an international espionage case, is used in the manufacturing of Oreo cookies. Du Pont says the product is not used in food. Mondelez International, which makes Oreos, said in a statement to ABC News that it does not “share specifics on our product formulas.”

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