Trade Secrets: South Korean Chemical Firm to Pay $2 Million Penalty

trade secretsSouth Korean Company Attempts to Steal Trade Secrets from DuPont

The US Department of Justice said that Toray Chemical Korea, Inc. agreed to pay the penalty and cooperate with a US government investigation of its activities.

Toray also agreed to implement an improved compliance and ethics program for its company. In return, the Department of Justice agreed to drop the case in two years if Toray abides by its agreement.

The criminal complaint against Toray was filed at the same time as the deferred prosecution agreement.

DuPont and Toray have also agreed to resolve any potential civil claims DuPont might have for attempted trade secret theft.

The Justice Department said that Toray, formerly doing business as Woongjin Chemical Co. Ltd., attempted to steal trade secrets from DuPont so that it could develop a product to compete with DuPont’s Nomex fiber.

Nomex is a fire-resistant material used in firefighting gear (such as the hood shown in the photo) and other applications.

The US Attorney’s office said that during 2011 Woongjin sought to improve its own Arawin fiber product by hiring, and attempting to hire, former DuPont employees as consultants.

The office said that two former DuPont employees met with Woongjin management in South Korea.  The managers asked the former employees to reveal details about DuPont’s processes.

One of the former employees offered to obtain the information from a current DuPont employee when he returned to the US.  However, he apparently did not actually do so.

A Woongjin executive reportedly also told an employee to obtain a sample of the short-cut fiber, called “floc,” used to make Nomex paper, by either legal or illegal means.

DuPont became aware of these efforts and contacted federal authorities.  FBI agents then interviewed the former DuPont employees who had met with Woongjin.

If you have questions about seeking a criminal investigation of trade secret theft, contact our office for a free initial consultation.

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Photo Attribution: “2007 Toronto Fire Service” by Sherurcij is licensed by Creative Commons Attribution 2.5 Generic.


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