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5 Most Famous Cases of Industrial Espionage

Posted 01/26/17 5:12 PM by Alisa McLellan

 “Nothing but my curiosity could have prompted to such researches…minute description of all that concerns this kind of work might, somehow, be useful in Europe.”


—Words of Father Francois Xavier d’Entrecolles, as he concluded his account in which he revealed the trade secrets of the makers of Chinese Porcelain, which he acquired while working with the kilns and craftsmen of the industry. This is one of the oldest examples of industrial espionage, still preserved in the memoirs.


Industrial espionage has been around since commerce began, as an act of acquiring intelligence from industry rivals and competitors. However, with the passage of time, its execution and model have changed. In this digital era, it has seamlessly integrated with digital gadgets and the cyber world; and despite the advancements in the field of e-discovery, corporations still find it hard to track the ones guilty of a felony. This blog will allow its readers to assume the roles of Fox Mulder and Dana Scully (we remember them, don’t we?) and takes them into the pages of infamously committed industrial espionage – from the past of the untold to the present of the unfold.


Gillette – The Best a Man Could Only Go So Far
Starting off on this list is the famous Gillette brand which paired up with Wright Industries in 1997, to help in the development of its next-gen shaver system. Unhappy and discontent, - the then employee of Wright Industries – Steven Louis Davis, leaked the blueprints of the designed technology to the competitors of Gillette through emails and fax. But the man could only go so far. Digital detectives were hired, and Steven was found guilty of releasing the confidential drawings, after which he was sentenced to 27 months in prison.


Avery Denison Corporation – That One Time Where Their Integrity Got Tapered
A reputable name in the world of adhesives, Avery Denison Corporation, was subject to industrial espionage back in 1997. One of its employees, Dr. Ten Hong Lee, was bribed to share the research and manufacturing data with the management of Four Pillars Enterprise. The company lost millions of dollars in revenue due to the compromised information.


Starwood and Hilton – The Clash of Hospitality Titans
This episode is pretty recent, where Hilton breached the paradigms of professional ethics by suborning Starwood’s two former executives into sharing classified information about hotel’s project plans. The felony included the illegal sharing of 100,000 confidential documents. Both the hotel chains reached a settlement in 2010.


Hitachi Locks Horn With IBM
In an era where workbooks and portable computers were still the new buzz, Hitachi somehow managed to get its hands on the design and technical blueprints of IBM workbooks. This sparked a war between the two technology giants, where IBM together with the help of FBI and counter -intelligence agencies were able to exploit the company’s planned industrial espionage. Many high ranked officials were found guilty, and eventually, the two companies agreed on an out of court settlement.


Mining the Minerals
Dubbed the “Night Dragon,” this industrial espionage of 2009 remains one of the unsolved mysteries. A network of hackers stole digital information containing the location of potential oil reserves from the database of six major European and US energy corporations. This included Royal Dutch Shell, Marathon Oil, Baker Hughes, Exxon Mobil, BP and Conoco Phillips. The true identities of the hackers are yet to be established.

 

As commerce continues to expand, so do the planned industrial espionage between industry rivals. Many stories have been told; more lie in wait while others are just at the beginning.

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Alisa McLellan

About The Author

Alisa McLellan, Esq. has worked in the eDiscovery field for over ten years, and is the Director of Project Management for Inventus’ East Coast and Central teams. She is an energetic team leader with proven skills in cross-functional team building, quality performance, and productivity improvement. Alisa is a licensed attorney and she completed her J.D. from Chicago-Kent College of Law in 2011, where she won CALI awards for excellence in Electronic Discovery and Civil Litigation. Alisa was also voted into the Order of the Coif—a prestigious national legal honorary society whose members are chosen based on exceptional academic performance while in law school. Alisa contributed on the Electronic Discovery Deskbook, a treatise on electronic discovery, and is currently a member of the Seventh Circuit Electronic Discovery Pilot Program. She is a former Litigation Paralegal with over five years of experience managing electronic discovery collections, reviews, and productions for a large, multinational law firm where she regularly travelled to client offices to manage custodian interviews and data collections. Alisa has also managed large-scale document reviews, and assisted with privilege reviews and privilege log creation. She is a Relativity Certified Admin, and a subject matter expert on collections, productions, Relativity and Clearwell.

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