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Ex-Dow Agro scientist set to be sentenced in espionage case

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Federal prosecutors are recommending that a former Dow AgroSciences researcher be sentenced to more than seven years in prison for sending trade secrets worth millions to China and Germany.

Kexue Huang is set to be sentenced at 2:30 p.m. Wednesday in U.S. District Court in Indianapolis after pleading guilty to the charge in October.

Federal sentencing guidelines call for Huang to spend 70 months to 87 months in prison, but prosecutors argued in a Dec. 12 court filing that he should receive a sentence at the “high end” of the guidelines.

“While the defendant previously did not have any criminal convictions, in only a few years he committed two serious offenses involving the misappropriation of trade secrets from two previously established U.S. companies,” prosecutors wrote. “In both instances, he disregarded his obligations of non-disclosure by breaching the confidentiality agreements which he signed.”

Chinese-born Huang worked as a researcher for Dow AgroSciences in Indianapolis from January 2003 until his firing in February 2008. He also held a similar position at Cargill Inc.

Huang was indicted first in Minnesota, alleged to have obtained trade secrets of a food product from Cargill. He also was indicted in Indiana last year on 12 counts of theft and attempted theft of trade secrets and was alleged to have passed on information about a Dow Agro organic pesticide.

“The only thing which stopped him was being fired by both companies, and ultimately, being arrested and prosecuted by the U.S. government,” prosecutors wrote.

The case was brought under the Economic Espionage Act, passed in 1996 after the U.S. realized China and other countries were targeting private businesses as part of their spy strategies.

Prosecutors said the trade secrets and biological material were given to Hunan Normal University in China, where Huang became a professor while working at Dow.

The Justice Department said Dow invested $300 million developing the information that Huang stole, but the plea agreement valued the total losses from Huang’s conduct at $7 million to $20 million.

Dow AgroSciences is a subsidiary of Midland, Mich.-based Dow Chemical Co.

Huang is a Canadian citizen with permanent U.S. resident status.
 
This story originally ran on IBJ.com Dec. 21, 2011.

 

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