Fri, Sep 25, 2015 - Page 15 News List

Couple to pay US$10m in damages

AP, ST LOUIS, Missouri

A judge has ordered a former employee of a mid-Missouri technology firm and his wife to pay US$10 million for stealing trade secrets and partnering with a Chinese firm to sell knockoff products to unsuspecting buyers, including the US Navy.

Franklin County Associate Circuit Judge Robert Schollmeyer this month awarded Rolla-based Brewer Science US$8.4 million in punitive damages and US$1.6 million in compensatory damages to cover the company’s lost profits, and research and development costs, due to the actions of Brewer Science engineer Hai Xuan and his wife, Hong Sheng, along with the company they formed, Best Tools LLC.

Brewer Science makes coatings used for microchips, along with spin coater machines, which apply thin uniform films to flat substrates. The judge determined that the couple partnered with a Chinese manufacturer to make and distribute spin coater machines that used Brewer Science technology and were in direct competition with the company.

In 2013, the US Department of the Navy awarded a US$5,580 contract to Best Tools LLC for “Laboratory Equipment and Supplies,” according to a Web site that tracks government contracts.

Foreign intellectual property theft “is a threat to American innovation, entrepreneurship and jobs,” said Alan Gerson, Brewer Science’s chief legal officer.

He urged lawmakers and police “to do more to address this issue and help American companies who have been victimized.”

The couple’s whereabouts is uncertain. Xuan has no listed telephone number and a message left with Sheng was not returned. The phone at Best Tools LLC has been disconnected.

Court documents did not list attorneys for them and they did not appear at the court hearing.

Brewer Science spokeswoman Loretta Wallis said on Wednesday that actually getting the money is a challenge since the couple may have left the country.

“Because this is an international issue, it makes it very difficult to collect the funding,” Wallis said.

In addition to the financial award, Schollmeyer entered a permanent injunction prohibiting Xuan, Sheng and Best Tools LLC from making or distributing knockoff products.

Meanwhile, Brewer Science said it has asked the US government to take further action against the Chinese firm since it continues to produce and sell items using Brewer Science technology.

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