China-based companies deny allegations they stole Hitachi technology - Financial Times

The Japanese individuals and a Chinese company at the heart of a trade secrets case filed in the US by Hitachi Metals last week have denied allegations that they misappropriated the Japanese company’s proprietary technology.

Japanese conglomerate Hitachi’s metals subsidiary filed a complaint with the US International Trade Commission alleging that China-based companies stole trade secrets for special alloy ribbons used in medical devices and theft prevention tags.

The complaint by Hitachi Metals and its US unit Metglas names companies including Advanced Technology & Materials. It also claims two former Hitachi Metals employees who are Japanese nationals provided confidential and proprietary technology to produce amorphous alloy ribbons to these groups.

Hideki Nakamura, a former Hitachi Metals employee alleged to have leaked trade secrets, said that he had worked as a consultant to Habei, a subsidiary of AT&M, but said he was advising the company on high-speed steel and not special amorphous alloy ribbons.

“I was asked by AT&M to advise on the amorphous ribbons, but I declined as it was a trade secret,” he told the Financial Times.

Mr Nakamura, now in his 70s, also denied that he had been a consultant to other Chinese companies specified in the complaint, or that he had received an award for contributing to the developing the amorphous steel industry in China, as alleged by Hitachi Metals.

AT&M, a state-owned enterprise, separately told the FT they never met or hired the two Japanese employees and that they had developed their own manufacturing process for amorphous alloy strips during 2006 to 2012.

The Chinese company was forced to develop its own production technology after an agreement with Honeywell to purchase Metglas in 2003 fell through, according to its executives. The deal was blocked by the Committee on Foreign Investment in the United States, or Cfius, and Hitachi Metals bought Metglas later that year.

Zhou Shaoxiong, AT&M’s chief engineer who oversees the development of the company’s amorphous steel production process, said Hitachi Metals was trying to protect its remaining US market by making the complaint.

Hitachi Metals and Metglas are calling for the ITC to investigate the Chinese companies involved, ban imports into the US of related products and bar the sale, marketing and distribution of products already in the US. The Japanese company said it would put its case forward during the ITC investigation process.

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