* Company stole confidential information from DuPont,
Teijin-prosecutor
* DOJ charges improperly extend Dupont monopoly-Kolon lawyer
WASHINGTON, Oct 18 (Reuters) - A U.S. grand jury charged
South Korea-based Kolon Industries Inc with criminal
trade theft in a long-running dispute over how the company
produced high-strength fiber, according to an indictment
unsealed on T hur sday.
Kolon and five company executives face charges that they
stole trade secrets belonging to DuPont Co, maker of
Kevlar fabric used in body armor and other products, and to
Japan's Teijin Ltd, maker of Twaron, a rival fabric.
The United States threatens to take at least $226 million in
assets from Kolon, which represents the gross proceeds of the
company's sales of its fabric, Heracron, according to the
indictment.
"Kolon is accused of engaging in a massive industrial
espionage campaign that allowed it to bring Heracron quickly to
the market and compete directly with Kevlar," said Neil
MacBride, the chief U.S. prosecutor in the Eastern District of
Virginia, in a statement.
The indictment, dated Aug. 21, was filed in U.S. District
Court in Richmond, Virginia. DuPont developed Kevlar in
Richmond, according to the indictment.
Kolon said it will vigorously defend itself against the
charges from the U.S. Justice Department. The company said the
fabric technology is four decades old and beyond the protection
of DuPont's patents.
"It is disturbing that the DOJ would bring charges that
effectively assist DuPont in improperly extending its monopoly,"
Kolon lawyer Jeff Randall said in a statement.
The company and the executives also face a charge that they
obstructed the U.S. government's investigation.
Randall said there are "significant questions as to what DOJ
now seeks to accomplish," given that Kolon and DuPont have
already been fighting over their products in court. The Justice
Department began its investigation in 2007 and opted not to
prosecute, Randall said.
In a civil lawsuit, a federal jury in 2011 ordered Kolon to
pay DuPont $920 million in damages based on similar accusations.
Kolon is appealing.
A judge in August barred Kolon from making its version of
the synthetic fiber for 20 years, but a federal appeals court
later said Kolon can continue while it pursues appeals.
A court hearing in the criminal case has been scheduled for
Dec. 11.
The case is United States v. Kolon Industries Inc, et al,
U.S. District Court for the Eastern District of Virginia, No.
3:12-00137.
