U.S.: Pair stole GM secrets for Chinese

Ex-engineer, spouse on trial, accused of trying to pass hybrid technology abroad

A former General Motors Co. engineer and her husband stole trade secrets of the automaker’s related to hybrid-car technology to help develop the vehicles in China, a U.S. prosecutor said Monday at the beginning of their trial.

Shanshan Du, the ex-GM employee, copied the Detroit-based company’s private information on the motor control of hybrids and provided documents to her husband, Yu Qin, the government alleges. Qin used the confidential data to seek business ventures or employment with GM’s competitors, including the Chinese automaker Chery Automobile Co., the U.S. said. General Motors contends the stolen trade secrets are worth more than $40 million, prosecutors said.

“This case is about theft as well as deceit,” prosecutor Michael Martin said Monday in federal court in Detroit in opening statements for the trial. The defendants are “partners in life, partners in business and partners in crime,” he said.

The defendants aren’t guilty, the couple’s lawyers said in their opening. The items at issue weren’t trade secrets and were “completely useless” for other companies, Frank Eaman, Qin’s lawyer said.

“A lot of fear is going on in this case,” Eaman said. This includes fear of Chinese people working in U.S. companies and planning ventures in China, as well as the defendants’ fear of the police, he said.

“The government has a fear that people will look at the evidence and see these are not trade secrets, no obstruction of justice, no wire fraud,” Eamansaid.

The case is one of more than a dozen brought in the past three years by the U.S. Justice Department alleging defendants of Chinese ancestry or citizenship sought to take trade secrets from U.S.-based companies for use by the Chinese government or businesses.

Last month in Chicago, a former software engineer for the Chicago-based CME Group Inc., the world’s largest derivative exchange, pleaded guilty to charges of downloading more than 10,000 files containing source code from his employer to support trading activities in an exchange in China.

In September in Newark, N.J., a native of China who worked for L-3 Communications’ Space & Navigation division was convicted of transporting stolen property and possession of trade secrets related to precision navigation devices.

In the Detroit case, Du and Qin were indicted in July 2010 on three counts each of trade theft and wire fraud. Qin was also charged with obstruction of justice. Both have entered innocent pleas.

The defendants argued in court papers that the government withheld evidence about the case, hampering their right to a fair trial.

This evidence included details of an FBI interview with a witness who indicated “several items named in the indictment were not secret” and that “contrary to the allegations in the indictment, several items of software possessed by Du were necessary for her work,” defense lawyers said in an Oct. 15 filing.

U.S. District Judge Marianne Battani, who is overseeing the case, said the trial should last several weeks.

Business, Pages 20 on 11/06/2012

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