Notable Cases of Intellectual Property Theft

If you really want to go back to the first time someone said, “Hey, that’s not yours; it’s mine!” then you have to travel back to Ancient Ireland, where the ownership rights of a biblical text turned into a violent dispute.

The Cathach is a Latin version of the biblical Psalms. It was originally believed to be written down by St. Finnian and was later borrowed and copied into another manuscript by Saint Columba. A dispute soon erupted over who owned the new version — the original author (Finnian) or the one who went on to copy it (Columba).

The case was taken before King who uttered the line, “To every cow belongs her calf, therefore to every book belongs its copy.” This dispute eventually led to the Battle of Cúl Dreimhne and the deaths of over 3,000 people.

Modern Day Intellectual Property Battles

Today these battles happen in offices or courtrooms instead of fields, and with markedly less bloodshed. The texts are replaced with corporate trade secrets or sensitive documents. The pugnacious parties are now the employers and their employees.

It shouldn’t have to be this way; companies should always have their essential documents and files kept safe. However, due to a combination of factors like entitlement and resentment, employees can feel like some corporate information belongs to them or is theirs to take.

So, how have these famous battles played out in the centuries since that first case? Let’s take a look at a few notable cases where employees engaged in a bit of IP theft.

From One Soda Company to Another: You May Wanna Watch Your Back

In 2006, three people conspired to sell a famous soda company’s trade secrets to…the other really well-known soda company. You’ve probably already guessed it — these companies were Coca-Cola and Pepsi.

The idea was hatched by Joya Williams, an employee of Coke. As the secretary to the global brand director at Coke’s headquarters, she was privy to plenty of confidential information. That made it easier for her to make off with confidential documents and product samples related to a new beverage Coke was developing.

After meeting up with two accomplices, the trio wrote a letter to Pepsi to let them know that they’d happily give this confidential information to the highest bidder. Unfortunately for them, Pepsi contacted Coke to let them know about their employee’s plan, resulting in an 8-year prison sentence for Williams.

Goldman Sachs’s Lengthy Legal Battle

A few years later in the financial world, Goldman Sachs faced an insider theft issue. Computer programmer Sergey Aleynikov had worked on the source code for a high-speed trading program Goldman Sachs had in the works.

Aleynikov was arrested at the Newark Airport in 2009 for allegedly copying the proprietary code with the intent to give it to a high-speed trading startup he had recently accepted a job with. He was sentenced to over 8 years in prison, but after serving only one year, he was released after an appeals court ruled that prosecutors didn’t properly use corporate espionage laws against him.

In 2012, he was arrested again, on state criminal charges instead of federal, and was convicted. Yet again, he avoided being found guilty because the two charges — unlawful use of secret scientific material and unlawful duplication of computer-related material — were overturned when the courts decided that the prosecution did not prove, satisfactorily, that Aleynikov committed the two “obscure” charges (difficult, as they had been created before the “digital age”).

Aleynikov maintained that he was merely copying “open source” code and not proprietary data from Goldman Sachs. As of January 2017, his conviction has been reinstated.

Sun Tzu and the Art of Solar Power Intellectual Property Theft

SolarCity, most notable for being linked to Elon Musk, got into hot water (solar-power heated?) in 2015 when they were accused of stealing IP that belonged to Cogenra Solar, Inc.

The stolen data was related to the development of a “shingled-cell solar module” that was proprietary to Cogenra. Cogenra argued that SolarCity is illegally using their trade secrets and manufacturing processed to get a head start on creating the new technology.

The proprietary data had actually (allegedly) made its way over to SolarCity when an employee intentionally and unlawfully downloaded it to a hard drive and then took it to their new job as a senior sales manager at SolarCity. However, SolarCity shot back that Congenra has failed to specifically call out any trade secrets they own in the lawsuit.

The case is currently being litigated.

Stop Intellectual Property Theft From the Start

It’s hard to stop an employee from taking files they have access to, that’s why it’s so important to track, control and monitor important company information from its inception. While IT departments can do a great job tracking data, they can’t possibly track everything all the time.

If you’re worried about keeping your proprietary files and intellectual property safe, you need a solution that can not only track your files but control access to it. FileHub™ is currently being designed to help organizations identify intellectual property that they don’t even know exists while also helping them track it’s lifecycle.

Want To Learn More?

We’re currently looking for early adopters for FileHub™ to help us understand the problems you face gaining visibility into your organization’s most important information. Contact us to learn more:

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About the author

I am the Content Marketer at SmartFile, which means I get to learn everything and write about it -- my two favorite things. I firmly believe that oatmeal cookies should contain chocolate chips, not raisins.

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