U.S. v. Wen Chyu Liu

Summarized by:

  • Court: Intellectual Property Archives
  • Area(s) of Law: Trade Secrets, Conspiracy to steal
  • Date Filed: 05-06-2013
  • Case #: 12-30105
  • Judge(s)/Court Below: U.S. Court of Appeals, Fifth Circuit
  • LexisNexis Citation: 2013 U.S. App. LEXIS 9194
  • Westlaw Citation: 2013 WL 1875810
  • Full Text Opinion

The relevant inquiry in a claim for conspiracy to steal trade secret information is whether the defendant conspired to steal information he believed to be a trade secret, rather than whether the information at issue was in fact a trade secret.

Opinion (Davis): Wen Chyu Liu (“Liu”) appealed his conviction for conspiracy to steal trade secrets on the grounds that the lower court erred in excluding testimony from his expert engineer. The government contended that Liu had conspired to steal the trade secrets of Dow Chemical Company (“DOW”) regarding certain chemical manufactures with the intent to sell the information to companies in China. Liu worked for DOW for almost thirty years in the research and development department. He had signed a confidentiality agreement, promising not to disclose confidential trade secret information to anyone outside the company. After retiring from DOW, Liu and his wife formed a private company that manufactured and sold similar chemical compounds as DOW. John Wheeler, an engineer recruited by Liu, admitted to stealing trade secrets from DOW for use in Liu’s private company. At trial, Liu testified that he had developed a new and wholly different process for manufacturing the chemical compound at issue, thereby avoiding use of DOW’s trade secrets. He sought to mount this defense via use of an expert chemical engineer named Ronald Ostermiller. The court, however, found that Ostermiller’s work experience did not sufficiently qualify him in the field of compounds at issue, and his testimony was excluded entirely. The Court found the relevant question in a conspiracy to steal trade secrets case to be whether Liu agreed to unlawfully acquire information he believed to be a trade secret. Though the Court found that the district court should not have excluded Ostermiller’s testimony, they found that the overwhelming evidence that Liu stole trade secrets from DOW meant the expert testimony would have been unpersuasive and have no effect on the verdict. The court found that the district court did err in excluding the expert testimony but that the error was harmless. Therefore, the Court AFFIRMED Liu’s conviction.

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