September 22, 2015 – Rolla, Mo. – Brewer Science today announced a major victory against intellectual property theft with a court decision that found an ex-employee, his wife, and their company guilty of stealing trade secrets and selling knockoff products to unsuspecting victims, including the U.S. Navy, who were misled as to the quality and origin of those products.
Court Awards Company $10 Million in Damages and Permanent Injunction for Theft of Trade Secrets
September 22, 2015 – Rolla, Mo. – Brewer Science today announced a major victory against intellectual property theft with a court decision that found an ex-employee, his wife, and their company guilty of stealing trade secrets and selling knockoff products to unsuspecting victims, including the U.S. Navy, who were misled as to the quality and origin of those products.
The illegal actions were committed by Hai Xuan, a former employee of Brewer Science, and his wife, Dr. Hong Sheng. Xuan and Sheng used equipment designs and other trade secrets stolen from Brewer Science and formed Best Tools, LLC. They partnered with Chinese manufacturer Jiangyin Jiatu Technical Co. Ltd. and others to manufacture and distribute “Smart Coater” equipment that competed directly with Brewer Science’s Missouri-manufactured equipment. Although the Smart Coater products were advertised as quality American-made products, they were, in fact, manufactured and assembled in China and did not meet the quality specifications promised to customers. Notably, although the Smart Coater equipment appeared and claimed to be similar to Brewer Science’s products, it lacked the quality, precision, and capabilities offered by Brewer Science.
The Missouri 20th Judicial District Court awarded Brewer Science punitive damages of $8.4 million and $1.6 million to cover Brewer Science’s lost profits and research and development costs. The Court also entered a permanent injunction against the Defendants and anyone collaborating with them from making, distributing, or selling the “Chinese knockoff” tools. These sanctions are significant, and the company today called on the U.S. government to help recover the court-ordered damages and take further action against the China-based firm, which continues to produce and sell counterfeit Brewer Science technology, including sales in the United States.
“Foreign intellectual property thieves are at war with U.S. manufacturers, and we need the President, Congress, and law enforcement to do more to address this issue and help American companies who have been victimized,” said Alan Gerson, Brewer Science Chief Legal Officer. “This theft is a threat to American innovation, entrepreneurship, and jobs. Brewer Science manufactures leading-edge technology products for our customers, which are created by the world’s best engineers and scientists using significant research and de