One of China’s biggest wind turbine manufacturers is accused of stealing software from an American firm, then using the ill-gotten trade secrets in turbines in the victim’s own backyard of Massachusetts.
Massachusetts-based AMSC, which makes software and equipment that regulates the flow of electricity from wind turbines to the electrical grid, was allegedly betrayed by an employee of one of its subsidiaries. The U.S. Justice Department charges that the employee stole the software by downloading it to a computer in Austria, then sold it to Chinese company Sinovel, which had formerly been an AMSC customer. Justice has indicted Sinovel, two Sinovel executives, and the rogue AMSC employee.
The theft led to the loss of 500 jobs and $800 million, AMSC says. U.S. Attorney John Vaudreuil says it was “nothing short of attempted corporate homicide.”
AMSC, which claimed the stolen software was used in four Sinovel turbines installed in Massachusetts, called for the Obama administration and Congress to re-evaluate the US trade relationship with China.
Daniel McGahn, the company’s president, said: “The fact that Sinovel has exported stolen American intellectual property from China back into the United States, less than 40 miles from our global headquarters, shows not only a blatant disrespect for intellectual property but a disregard for international trade law.”
The software in question is used to run AMSC’s PM3000 wind power convertor [PDF].
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] technology, without having to pay AMSC for previously-delivered products and services, thereby cheating AMSC out of more than $800 million.
It seems that the masterminds behind the alleged software heist may escape justice, shielded by their foreign residencies, though Justice will proceed with its prosecution of Sinovel. From The New York Times:
The two Chinese executives are in China, and the former employee, who was working for AMSC in Austria, has returned home to Serbia, according to John W. Vaudreuil, the United States attorney. He said that the United States did not have extradition treaties with either nation, but the accused could be arrested if they traveled to a country with which the United States does have an extradition treaty.
Sinovel will face a trial here, he said, and could face fines equal to twice the damages, plus restitution to AMSC.
The employee, Dejan Karabasevic, 40, served a brief prison term in Austria related to the case, Mr. Vaudreuil said.