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Couple charged over hybrid car industrial espionage plot

GM secrets allegedly offered to Chinese rival

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A Michigan couple faces charges of stealing industrial secrets on hybrid cars from GM before attempting to sell the data to a Chinese auto manufacturer.

Yu Qin, 49, and his wife, Shanshan Du, 51, of Troy, Michigan have been charged with four offences, including unauthorised possession of trade secrets and wire fraud under an indictment unsealed on Thursday. GM reportedly places a value of $40m on the stolen documents.

Former GM worker Du allegedly copied thousands of sensitive documents onto a hard disk after she was offered a severance agreement in January 2005. This hard drive was used by Millennium Technology International, a firm run by the two defendants, which months later allegedly offered hybrid vehicle technology to Chery Automobile in China.

The circumstances of the case raise serious questions about the security controls applied by GM to safeguard its research around the time of the alleged data theft.

In May 2006 the couple's home was raided, leading to the recovery of computers containing industrial secrets, according to prosecutors. The couple allegedly attempted to shred presumably incriminating documents and dump them after their initial arrests, alleged misdeeds that have resulted in an obstruction of justice charge.

The defendants appeared in federal court on Thursday for arraignment on charges punishable by up to 20 years imprisonment and heavy fines on conviction.

"As our auto industry works to find new areas of innovation, such as hybrid technology, we will not tolerate the theft of our trade secrets from foreign competitors," said Barbara McQuade, United States Attorney for the Eastern District of Michigan. "We will aggressively prosecute people who steal from the investment that our auto industry has made in research and development."

A statement on the charges can be found on a DoJ website for the district here (pdf). ®

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