DuPont Trade-Secret Prosecutors Add Charges Against Liew

California businessman Walter Liew was charged with seven new crimes, including filing false tax returns, in a revised indictment alleging he conspired to provide DuPont Co. (DD) trade secrets to a Chinese company.

U.S. prosecutors filed the new charges today in federal court in San Francisco.

China’s Pangang Group Co., Liew and two former DuPont employees were charged last year with conspiring to steal information about chloride-route titanium oxide, a white pigment used in paint, plastics and paper.

Pangang runs the largest titanium complex in China and is one of the country’s biggest titanium pigment producers, according to its website.

Liew, of Orinda, California, and the other defendants sold the confidential information to Pangang so it could develop a large-scale titanium-oxide factory in Chongqing, prosecutors allege. DuPont, based in Wilmington, Delaware, is the world’s largest manufacturer of titanium dioxide, and won’t sell or license its technology to Chinese companies.

Liew, owner of now-defunct Oakland-based USA Performance Technology Inc., has denied the allegations.

Liew has been in federal custody in Dublin, California, for 19 months. A trial hasn’t yet been scheduled in the case.

Cash Bond

U.S. Magistrate Judge Nathanael Cousins in San Francisco agreed, over objections from federal prosecutors, to release him from detention on a $2 million cash bond.

Cousins said Feb. 27 said that keeping him in custody may violate his constitutional rights, noting that Liew is a U.S. citizen who has lived in the San Francisco Bay area for 30 years. Cousins increased the bond from $200,000.

Prosecutors appealed Cousins’ order, saying Liew is a flight risk and citing his family and financial ties to China and lies he allegedly told investigators. U.S. District Judge Jeffrey White, who is presiding over Liew’s case, put Cousins’ release order on hold and scheduled a March 18 hearing on the detention matter.

Simona Agnolucci, an attorney for Liew, didn’t immediately respond to an e-mail message seeking comment on the new charges.

The case is U.S. v. Liew, 3:11-cr-00573, U.S. District Court, Northern District of California (San Francisco).

To contact the reporter on this story: Karen Gullo in San Francisco at kgullo@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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