Metaldyne Execs Stole Trade Secrets, Prosecutors Claim

Two former employees of Metaldyne Corp. -- one of them a vice president -- were charged Tuesday with stealing the company's trade secrets to sell to a Chinese competitor. Anne Lockwood, 52, of Rochester Hills and Fuping Liu, 41, a U.S. citizen who lives in Shanghai, China, were charged in a criminal complaint with stealing the company's technology for making engine connecting rods from powdered metal.

From Detroit Free Press

PLYMOUTH, MI — Two former employees of Metaldyne Corp. — one of them a vice president — were charged Tuesday with stealing the company’s trade secrets to sell to a Chinese competitor.

Anne Lockwood, 52, of Rochester Hills and Fuping Liu, 41, a U.S. citizen who lives in Shanghai, China, were charged in a criminal complaint with stealing the company’s technology for making engine connecting rods from powdered metal.

FBI agent Jeffrey Edwards said in a criminal complaint that the company spent 10 years and millions of dollars to perfect the technology for making components such as connecting rods for truck engines from powdered metal. Metaldyne is one of two auto suppliers worldwide that make powdered-metal connecting rods, Edwards said.

On Tuesday, U.S. District Judge Mona Majzoub released Lockwood on a $10,000 unsecured bond. Liu was detained overnight pending a detention hearing today. The charge carries a maximum penalty of 10 years in prison and a $250,000 fine.

Edwards said in the complaint that Lockwood and Liu took the design for a new connecting rod prototype that will go in 2007 International Truck and Engine (formerly Navistar) models.

Lockwood, an employee since 1989, was vice president of sales. Liu, who worked for the division that developed the connecting rods, reported to Lockwood and was transferred to the company’s Shanghai office. Liu resigned in April 2004. Lockwood resigned in February 2004. Edwards said the theft came to light in August 2004 after two companies that provided equipment to make the connecting rods received an unsolicited e-mail from a representative of a Chinese company, Chongqing Haufu Industry Ltd., a manufacturer of powdered metal automotive components in China. The representative said the company was planning to launch a new program to make powdered metal connecting rods and asked for quotes for buying equipment to make the rods.

The e-mail contained three attachments that company officials recognized as trade secrets from Metaldyne. Metaldyne employees said Lockwood was the most likely person to have had access to the information. Edwards said Lockwood had formed a company and was trying to land a contract with the Chinese firm. She also had traveled to China and was working with Liu.

Liu allegedly introduced Lockwood to representatives of Haufu and served as a partner and go-between in the transfer of trade secrets. Lockwood’s lawyer, Mark Kriger, said he couldn’t comment. Liu’s lawyer, Deputy Federal Defender James Gerometta, couldn’t be reached.

Myra Moreland, Metaldyne’s vice president of corporate affairs, commended the FBI for helping to protect the company’s trade secrets.

“Our intellectual property is absolutely critical to our success as a company,” she said.

Metaldyne, headquartered in Plymouth, Mich., is a global designer and supplier of metal-based components and assemblies for the automotive industry. It makes a wide range of engine, powertrain and chassis components. The company employs more than 7,500 people at 50 plants in 13 countries and posts annual revenue of about $2 billion.

Metaldyne CEO Tim Leuliette has been outspoken about Chinese companies pirating U.S. auto technology.

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