United States

United States

US fines Sinovel in IP theft case

UNITED STATES: A federal judge has fined Chinese turbine maker Sinovel Wind Group $1.5 million for stealing trade secrets from US technology firm AMSC.

Sinovel has been ordered to pay $1.5 million by a US federal judge
Sinovel has been ordered to pay $1.5 million by a US federal judge

The fine was the largest that US district judge James Peterson could have levied. He also placed Sinovel on probation for a year.

A jury had convicted Sinovel in January  of conspiracy, trade-secret theft and wire fraud in stealing the proprietary technology from AMSC to use in its own turbines in China. The trial lasted for 11 days.

"The devastation [that] Sinovel's illegal actions caused to AMSC and its employees will not be tolerated," said Scott Blader, US attorney for the western district of Wisconsin.

The theft was instrumental in Massachusetts-based AMSC losing more than $1 billion in shareholder equity and almost 700 jobs.

In early July, Sinovel and AMSC had announced a settlement under which Sinoval would pay $57.5 million to AMSC in two installments.

At one point, the American company had been seeking damages and lost shipment payments of $1.5 billion.

President Donald Trump, who has imposed harsh tariffs on some $34 billion of Chinese imports, has often claimed that Chinese companies steal American intellectual property.  

He cited the theft of trade secrets as one reason for the ongoing US-China trade war.

According to court documents, Sinovel had agreed to buy AMSC’s proprietary computer software for low-voltage ride-through technology.  

But in March 2011, Sinovel stopped paying for the software, and AMSC employees in China discovered unauthorised versions of the software operating on Sinovel turbines.

The stolen source code was stored on an AMSC computer in Wisconsin.

AMSC employee Dejan Karabasevic, based in Austria, stole the software and provided it to Sinovel. After a trial in Austria in 2011, he was sentenced to a year in jail.

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