Former DuPont Scientist Pleads Guilty to Economic Espionage

Dept Of Justice ^ | March 02, 2012 | U.S. Attorney’s Office Northern District of California

[Larry381]

SAN FRANCISCO—Tze Chao pleaded guilty in federal court in San Francisco late yesterday afternoon to conspiracy to commit economic espionage, United States Attorney Melinda Haag announced.

In pleading guilty, Chao, who was employed by DuPont from 1966 to 2002, admitted that he provided trade secrets concerning DuPont’s proprietary titanium dioxide (TiO2) manufacturing process to companies he knew were controlled by the government of the People’s Republic of China (PRC). Chao admitted that beginning in 2003, the year after he left DuPont, he began consulting for the Pangang Group, a PRC government-controlled company that produces TiO2. According to his plea agreement, Chao had “learned that the PRC government had placed a priority on developing chloride-process TiO2 technology in a short period of time and wished to acquire this technology from western companies.”

In 2008, Chao submitted a bid to design a 100,000-ton per year TiO2 facility for the Pangang Group. In connection with his bid, Chao provided DuPont information to the Pangang Group, including information that, according to his plea agreement, he “understood to be secret to DuPont and not available to the public.” Chao did not win the contract but in 2009 was asked by Pangang Group to review design work done by USA Performance Technology, Inc. He did so, and in the course of this review, provided additional DuPont trade secret information to Pangang Group.

Chao’s plea comes in connection with the superseding indictment returned three weeks ago charging Walter Liew, Christina Liew, Robert Maegerle, and USA Performance Technology, Inc., among others, for their efforts to sell DuPont trade secrets to companies controlled by the PRC government. Those companies—the Pangang Group and three subsidiaries—also were named as defendants in the indictment and charged with conspiracy to commit economic espionage and attempted economic espionage. As part of his plea agreement, Chao agreed to cooperate in the investigation and prosecution of this case.

Chao, 77 of Newark, Del., was indicted by a federal Grand Jury on Feb. 7, 2012. He was charged with one count of conspiracy to commit economic espionage, in violation of 18 U.S.C. § 1831(a)(5). Under the plea agreement, Chao pleaded guilty to this charge as alleged in the superseding indictment.

Chao was arraigned yesterday in San Francisco and released on his own recognizance. He entered his guilty plea before the Honorable Jeffrey S. White late yesterday afternoon in San Francisco. A date for sentencing was not set. The maximum statutory penalty is 15 years in prison and a fine of $500,000, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

[SatinDoll]

“...released on his own recognizance...”

Stupid thing for a judge to have done.

[null and void]

Here in Silicon Valley the saying is:

Half the Chinese are here spying on us.
The other half are spying on them...

[traumer]

Tze Chao - the People’s Republic of China (PRC)....

Why am I not surprised.

[La Lydia]

Determine the dollar amount of economic damage this person did and impose an import tax on Chinese goods in that amount. Rinse. Repeat every time this happens until the Chinese get the message. It’s the only language they understand.

[Chode]

in my day it was called Industrial Espionage...

[Amberdawn]

My mother works for said company. She told me yesterday that she counted 200 names in Dupont’s employee registry with the last name of Liu, a common Chinese surname. God only knows how many Chinese there are total.

[tpcorr]

Does anyone know how the defendant Robert Maegerle plead? I cannot find anything about his plea anywhere.

Tom

[Amberdawn]

http://www.msnbc.msn.com/id/46343525/ns/world_news-asia_pacific/t/former-dupont-engineer-released-bond/ This is all I could find.

[tpcorr]

Thanks for checking, but that is old news. I was specifically referring to the the March 1st arraignment, at which Mr. Chao plead guilty. Robert Maegerle was also arraigned then, but I can’t seem to find how he plead. Thanks for checking though amber.

Tom