China-based Sinovel and three individuals have been charged with stealing intellectual property (IP) from U.S.-based AMSC, the U.S. Department of Justice (DOJ) announced on Thursday.
A federal grand jury in the Western District of Wisconsin returned an indictment charging Sinovel Wind Group Co. Ltd., dba Sinovel Wind Group (USA) Co. Ltd.; Su Liying, the deputy director of Sinovel's research and development department; Zhao Haichun, a technology manager for Sinovel; and Dejan Karabasevic, a former employee of AMSC Windtec GmbH, a wholly owned subsidiary of AMSC, with one count each of conspiracy to commit trade secret theft, theft of trade secrets and wire fraud.
"Today, we announce charges against Sinovel and three individuals for stealing proprietary wind turbine technology from AMSC in order to produce their own turbines powered by stolen intellectual property," said Mythili Raman, acting assistant attorney general of the DOJ's criminal division. "This charged IP theft caused significant harm to a domestic company that develops cutting-edge technology and employs Americans throughout the country."
According to the DOJ, the indictment alleges that the four defendants conspired to obtain AMSC's copyrighted information and trade secrets in order to produce wind turbines and to retrofit existing wind turbines with AMSC's software technology, without having to pay AMSC for previously delivered products and services, thereby cheating AMSC out of more than $800 million.
The indictment alleges that Sinovel, through Su and Zhao, recruited Karabasevic to leave AMSC Windtec and join Sinovel and to secretly copy IP from an AMSC computer system. The four defendants are charged with stealing the source code of PM3000, a part of AMSC's wind turbine electrical control system, on March 7, 2011, and transmitting it by downloading it from an AMSC computer in Wisconsin to a computer in Klagenfurt, Austria.
The indictment alleges that following the theft of AMSC's intellectual property, Sinovel commissioned several wind turbines in Massachusetts and copied into the turbines software compiled from the software stolen from AMSC.
If convicted, Sinovel faces a maximum penalty on each count of five years of probation and a fine of twice the gross gain or loss, meaning Sinovel would face a fine for each count charged of up to twice the alleged loss of more than $800 million.
If convicted, Su, Zhao and Karabasevic each face a maximum penalty of five years in prison on the conspiracy charge, 10 years in prison for theft of a trade secret and 20 years in prison for wire fraud, according got the DOJ.
