Durability + Design

Building Performance and Aesthetics

A Product of Technology Publishing
JPCL/PaintSquare | D+D | Paint BidTracker

D+D 2014
Register Now for D+D 2014

Paint and Coatings Industry News

Main News Page


Former Valspar Corp. Technical Manager Gets 15-Month Prison Term for Stealing Trade Secrets

Thursday, December 9, 2010

More items for Coatings Technology

Comment | More

A former Valspar Corp. coatings technologist was sentenced to 15 months in federal prison for stealing trade secrets—including paint formulas worth up to $20 million, according to the U.S. attorney's office in Chicago.

The defendant, David Yen Lee, 54, pleaded guilty in September to theft of a trade secret, admitting that he planned to take proprietary formula information to a new employer in China, Nippon Paint.

Lee, of Jersey City, N.J., formerly of Arlington Heights, Ill., and originally from Taiwan, also was ordered to pay Valspar restitution of $30,975 as compensation for the cost of the company’s internal investigation.

Lee faced up to 10 years in prison and a $250,000 fine. Federal agents arrested Lee, who holds a doctorate in chemistry, in March 2009. At the time, he was carrying flash drives containing about 44 gigabytes of confidential Valspar formulation data that prosecutors said was worth between $7 million and $20 million. He was then indicted on five counts of economic espionage.

According to the indictment, Lee began work in 2006 as a Technical Director for Minneapolis-based Valspar at its facility in Wheeling, Ill. Authorities said he was technical director of new product development for the company’s Architectural Group.

Some of Lee’s duties involved Huarun Ltd., a Valspar subsidiary in the People’s Republic of China, and he traveled there occasionally on business, authorities said. His work for Valspar included research of new paint technologies, coordinating with other paint laboratories, coordinating projects with Huarun,  and overseeing Valspar’s technical service group.
 
A federal indictment against Lee alleged that between September 2008 and February 2009, Lee negotiated a new position with Nippon Paint, Asia’s largest paint manufacturer, to work on developing paint products and technologies. Between November 2008 and March 2009, Lee “downloaded technical documents and materials, including trade secrets, belonging to Valspar from Valspar’s secure internal computer network, and removed numerous documents and other materials from the offices of Valspar,” the indictment said.

Lee accepted a job with Nippon in February 2009, and was to start work April 1, 2009, in Shanghai, the indictment stated. In March 2009, he transferred documents and materials from Valspar and Huaran, including product data, to an external thumb drive, and told Valspar he planned to resign. He was arrested on March 26, 2009.

Lee reportedly was in line to join Nippon as vice president of technology and administrator of research and development.

Authorities said there was no evidence that he actually disclosed any of the stolen trade secrets, according to news reports.

   

Tagged categories: Coatings manufacturers; Criminal acts; Laws and litigation; Nippon Paint; Valspar

Comment Join the Conversation:

Sign in to our community to add your comments.

VaproShield
Innovative Vapor Permeable Air Barrier Membranes

Designed for all climate construction and compatible with most substrates for easy installation, our membranes emit zero VOC's and require no primer.


Durability + Design (D+D)
Be There!
May 20-22

Network with the emerging technical community of specifiers, architects, contractors, and facility owners at the first Building Performance Conference.


KTA-Tator, Inc. - Corporate Office
KTA Inspection Instruments

Eliminate Application Uncertainties:
• Moisture Content
• Ambient Conditions
• Surface Preparation
• Coating Thickness
Call 1-800-KTA-GAGE
(800-582-4243)


Acrymax Technologies, Inc.
Go for the Max with Acrymax!

We offer solutions you can count on. Roof coating systems, protective coatings, corrosion control and weatherproofing. Proven performance for over 60 years.


Armakleen Company, The
No Ordinary Soda

ARMEX® baking soda-based abrasives from the makers of ARM & HAMMER® products offers over 12 formulas specially engineered for your application and your budget.


HydeTools, Inc.
Best Spray System on the Market

For a limited time only, get 50% off the HYDE® RVT® Spray System – pole, gun and lightweight spray head! • Saves time • Extends your reach • Less cleanup!


Arroworthy
ArroWorthy's Handcrafted Professional Brushes

One Dip of paint with our handcrafted semi-oval Rembrandt brush, you'll see why ArroWorthy makes a professional brush of unrivaled quality and performance.

 
 
 
Technology Publishing

The Technology Publishing Network

The Journal of Protective Coatings & Linings (JPCL) PaintSquare
Durability + Design Paint BidTracker JPCL Europe

 
EXPLORE D+D:      Interact   |   Blogs   |   Resources   |   Buying Guides   |   Webinars   |   White Papers   |   Classifieds
GET D+D:      Subscribe   |   Advertising Media Kit
KNOW D+D:      About D+D   |   Privacy policy   |   Terms & conditions   |   Site Map   |   Search   |   Contact Us
 

© Copyright 2010-2014, Technology Publishing, Co., All rights reserved
2100 Wharton Street, Suite 310, Pittsburgh PA 15203-1951; Tel 1-412-431-8300; Fax 1-412-431-5428; E-mail webmaster@paintsquare.com