FBI ramps up probe of fired Ford engineer, seizes emails – The Detroit News

Posted: Friday, July 25, 2014

Detroit ? The FBI ramped up its investigation of a fired Ford Motor Co. engineer Friday, revealing agents have seized her personal email account after searching her home and seizing secret listening devices planted inside the automaker?s headquarters.

A search warrant filed Friday in federal court shows the FBI seized former Ford engineer Sharon Leach?s Gmail account, including all emails, drafts, photos, phone numbers, contacts and bank accounts tied to the account. Google provided the information Wednesday.

The 43-year-old Wyandotte woman has not been charged with a crime amid the ongoing investigation. Her lawyer said Leach hid listening devices in conference rooms at Ford headquarters so she could take better notes during meetings.

?It didn?t involve anything of a spying nature,? attorney Marshall Tauber told The News. ?She wanted to record conversations of meetings she attended but didn?t know how to do it. She was insecure about her note-taking.?

Ford said it initiated the investigation, asked the FBI for help and gave agents eight listening devices, the automaker?s spokeswoman Susan Krusel said.

?We continue to work in cooperation with the FBI on this joint investigation,? she said Friday. ?As this is an ongoing investigation, we are not able to provide additional details.?

Leach, who worked as a mechanical engineer for about 17 years, was included on a panel speaking about hybrid technology performance at an April auto industry event in Detroit.

The investigation, first revealed by The Detroit News, is the latest espionage probe within an auto industry that has suffered tens of million of dollars in losses in recent years due to stolen technology. In all, economic espionage costs the government and companies $400 billion a year or more, according to estimates in a 2011 report to Congress.

A review of court filings show the government has successfully prosecuted several insiders locally in recent years and automakers have pushed for maximum sentences.

China and Russia pose a ?pervasive threat? to sensitive economic information and technology, according to the 2011 report to Congress.

?Chinese actors are the world?s most active and persistent perpetrators of economic espionage,? the report concluded. ?U.S. private sector firms and cyber security specialists have reported an onslaught of computer network intrusions that have originated in China…?

R. Mark Halligan, partner at Chicago-based Nixon Peabody LLP law firm and a trade secret law expert, said the automotive industry takes the theft of trade secrets seriously but handles them no differently than any other company.

?It?s an industry that has a lot of technology and is a profitable business,? he said Friday. ?There?s nothing that?s any different than an airline, manufacturing, or any sort of industrial company. If you?re an industry that?s making money, you?re susceptible.?

He said the number of trade secret theft cases has increased with advances in technology.

?Since we?ve been in the computer age, you can take the entire company, first on a floppy disk, then on a CD ? and now you can move things into the cloud,? he said. ?The ease with which information can be stolen has resulted in a lot of these cases.?

The Economic Espionage Act of 1996 makes the theft of trade secrets a federal criminal offense. Halligan said penalties can range from 10 years in prison for individuals to millions of dollars in fines for corporations.

?It?s critical to the success of U.S. companies that they?re able to protect their proprietary investments,? he said. ?It?s taken very seriously by the justice department. It?s a high priority.?

The Ford investigation emerged Thursday, more than a year after a former General Motors Co. engineer and her husband were found guilty of stealing trade secrets from the Detroit automaker’s hybrid-car technology program to sell to a Chinese competitor.

In that case, former GM engineer Shanshan Du and her husband, Yu Qin, of Troy, who were accused of plotting to provide hybrid electric vehicle technology to Chery Automobile Co., a Chinese auto manufacturer and GM competitor.

The investigation also showed that, when Du was with GM, she and Qin had begun planning a joint venture to develop and manufacture hybrid vehicle motor control systems for Chery.

In 2006, the FBI executed a search warrant on the couple’s home and recovered more GM documents. That same day, an FBI surveillance team observed Qin discarding two garbage bags full of shredded documents into a grocery store dumpster, the court said.

A jury convicted Qin on all counts. It convicted Du on conspiracy and trade secrets counts, but acquitted her of wire fraud counts. Qin was sentenced to three years in prison and a $25,000 fine. Du was sentenced to 12 months and one day of imprisonment with a $12,500 fine.

A federal appeals court upheld the convictions in June.

At sentencing, John Calabrese, at the time a GM vice president of global vehicle engineering, urged the judge to issue a harsh sentence.

?On behalf of GM, I urge you to impose the maximum allowable sentence and send a strong message that the theft of such technology will be punished to the maximum extent of the law,? Calabrese wrote in a letter to U.S. District Judge Marianne Battani.

?Protecting such trade secrets from improper disclosure and use is tremendously important to GM,? he continued. ?The life blood of our organization, and that of our Michigan based competitors, is the intellectual property that we constantly develop and rely on as the foundation for future product designs. The theft of that confidential technology and its sale to overseas competitors greatly injures domestic auto makers and directly impacts Michigan?s economic well-being.?

In 2011, Ford product engineer Yu Xiang Dong was sentenced to almost six years in prison for stealing trade secrets.

The Beijing man also was ordered to pay a $12,500 fine after pleading guilty in federal court to two counts of theft of trade secrets.

Yu is expected to be deported after completing the sentence.

A Ford product engineer from 1997-2007, he was indicted in October 2009, accused of copying design details on doors, mirrors, power systems, wipers and other components before leaving his job in Dearborn in 2007 and going to work in China.

He was arrested after flying to Chicago in October 2009. Authorities found Ford design documents on his work laptop.

According to the federal indictment, Yu had access to ?sensitive Ford design documents.?

?We will vigilantly protect the intellectual property of our U.S. automakers, who invest millions of dollars and decades of time in research and development to compete in a global economy,? U.S. Attorney Barbara McQuade said in April 2011. ?Those who do not play by the rules will be brought to justice.?


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