2 Men Convicted Over Secret of Titanium Dioxide

Walter Liew, Robert Maegerle guilty of economic espionage
By Kate Seamons,  Newser Staff
Posted Mar 6, 2014 2:11 PM CST
2 Men Convicted Over Secret of Titanium Dioxide
A storage tank for a Dupont plant is reflected in the Kanawha River in Marmet, W.Va.   (AP Photo/Steve Helber)

A six-week trial yesterday ended in the conviction of two California men who stood accused of stealing chemical giant DuPont's recipe for titanium dioxide and selling it to a Chinese competitor for more than $20 million. Walter Liew, 56, and Robert Maegerle, 78, now face as many as 20 and 15 years behind bars, respectively, for handing over the secrets of what Quartz describes as "a chemical used to whiten the cream in Oreo cookies" (along with plenty of other uses related to everything from paint to car exteriors). That competitor, state-owned Pangang Group, had apparently had its offers to buy the formula from DuPont turned down on a number of occasions; per Businessweek, prosecutors say Panang Group is in the process of constructing a sizable plant to produce the pigment, which generates $17 billion in sales for DuPont annually.

Prosecutors argued that Liew and his wife (who goes on trial later this year) launched a company in the 1990s with the specific intention of profiting off of China's desperate desire to manufacture the chemical, reports AP. According to testimony and court documents, China buys more titanium dioxide from the West than it itself makes, and its leaders had declared that duplicating—or getting its hands on—DuPont's recipe was a national economic and scientific imperative. The couple recruited DuPont scientists, including Maegerle, who worked for DuPont from 1956 to 1991 before joining the Liews. Prosecutors said he provided the Liews with detailed information about DuPont’s Taiwan factory. The defendants had argued that China obtained the information from public sources, such as expired patents. (How the Liews got busted is pretty fascinating.)

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