A former chemical engineer for W.L. Gore & Associates is under arrest for theft of trade secrets, federal officials said.
Kwang Seoung Jeon, 48, a U.S. citizen born in Seoul, South Korea, stands accused of attempting to steal a large number of paper and electronic documents related to Gore’s new “multispectral concealment fabrics” or high tech camouflage sold under the name “Nemesis,” after he received a poor performance review.
Police arrested Jeon April 2 at a Newark hotel on the same day he had tickets to fly back to his native Korea. He has been in custody since his arrest as a possible flight risk and will appear for a detention hearing before a U.S. Magistrate Judge on Monday.
Jeon’s arrest and prosecution follows several similar high-profile cases in recent years involving theft of trade secrets in Delaware.
The Delaware U.S. Attorney’s Office and Jeon’s federal public defender Dina Chavar declined comment on the case.
According to a criminal complaint unsealed after Jeon’s arrest, Jeon had worked for Gore since January 2012 after a 14-year career at Procter & Gamble.
Jeon was part of Gore’s “Camouflage, Concealment and Detection” development team and worked on fabrics that help mask a soldier or security officer from surveillance technology like radar and infrared sensors, according to court and company promotional documents. Sometime in late 2013, according to court papers, supervisors told Jeon that he needed to improve his job performance and he would not be receiving a pay raise in 2014.
On March 4, Jeon told his supervisors that he would be resigning at the end of March so he and his wife could return to South Korea. Due to the sensitive nature of Jeon’s work, Gore moved Jeon out of the team’s area but a short time later two employees reported seeing Jeon printing “many ‘book’ sized documents early in the morning in the CCD area,” according to court documents.
In a subsequent interview on March 11, Jeon told superiors he intended to work as a consultant when he returned to South Korea “but he would not specify what field in which he intended to consult” or identify the contacts he said he was going to work with, according to the criminal complaint.
The next day, company officials told Jeon they would pay him through April 1 but he was to stop reporting to work at Gore’s Elkton, MD, facility. In an exit interview, Jeon denied having any portable electronic storage devices or paper documents containing Gore information at home, according to court documents.
At that time Jeon read out loud and signed the company’s “Association Separation Agreement,” acknowledging terms of his non-disclosure obligations related to Gore company information.
Officials then escorted Jeon from the building and Gore officials secured his company laptop. A review of that laptop showed Jeon had accessed a restricted company network drive that contained “highly confidential” company files.
Investigators also found Jeon’s computer ended up connected to at least three different external drives – small, easily hidden, thumb storage drives – in violation of company policy on Feb. 24, March 4 and March 11. Computer logs on the laptop showed that between February and March, 540 documents and at least 27 folders or files from Gore’s restricted network drive ended up accessed. A company official determined from file names the files saved to an outside drive contained Gore trade secrets and furthermore related to products protected by the U.S. Arms Export Control Act.
Gore spokeswoman Jenny Maher said in an email when the company discovered Jeon may have taken sensitive Gore information they immediately informed U.S. authorities. “Gore considers the alleged theft of intellectual property and potential violations of export control regulations very serious offenses,” she said.
“It is our longstanding policy to vigorously enforce export control requirements and protect the company’s intellectual property. We appreciate the prompt actions taken by U.S. federal authorities, and we will continue to assist as the case progresses,” she said.
Police arrested Jeon just before 6 a.m. on April 2 at an unnamed Newark hotel as he was getting into a vehicle with his luggage, bound for John F. Kennedy Airport in New York, according to court papers. He had closed on the sale of his Newark home the day before.
Gore is in a similar civil theft of trade secrets case in Chancery Court against Huey Shen Wu, that last week resulted in Delaware’s Court of Chancery issuing an arrest warrant for contempt, a first for the 220-year-old court that specializes in business disputes.
Wu left Gore in 2004 after working on polymers related to the company’s signature product Gore-Tex and court-ordered from working in the polymers industry until 2016. But Gore officials charged in a 2012 suit Wu was violating the court order by setting up several research and development companies in China and Taiwan to compete with Gore. The court ordered Wu to surrender his passports and visas but Wu declined, resulting in the civil warrant issued last week.
It is unclear if Wu, who has homes in Newark and Taiwan, is still in the country.
Unlike the Jeon case, there was no criminal theft of trade secrets prosecution against Wu.