Cybercrime, Schneider, Dotcom: Intellectual Property

June 10 (Bloomberg) -- Cybercrime remains a growth industry.

That’s the main message from former U.S. intelligence officials, who in a report yesterday outlined scenarios for how $445 billion a year in trade theft due to computer hackers will worsen. They warned that financial companies, retailers and energy companies are at risk from thieves who are becoming more sophisticated at pilfering data.

The outlook “is increased losses and slower growth,” with no “credible scenario in which cybercrime losses diminish,” according to the report published by the Washington-based Center for Strategic and International Studies.

The biggest driver in the cost is stolen intellectual property, said Tom Gann, vice president of government relations for McAfee, a unit of Santa Clara, California-based chipmaker Intel Corp.

Trade secrets are stolen online by foreign governments, criminal organizations and company competitors who hire their own hackers, Gann said in a phone interview. The attacks are enabled by the growth of a sophisticated underground economy where hackers and exploitation tools can be bought using digital currencies like bitcoin.

Hackers may break into company networks or the computers of their lawyers and accountants to steal information about pending corporate acquisitions and business strategies, the report finds.

South Africa Tax Authorities Says It Knows Industrial Spies

New allegations of industrial espionage by tobacco companies operating in Africa have surfaced, the Zimbabwe Independent reported.

A letter from the South Africa Revenue Service, South Africa’s taxing authority, said it was able to identify people paid to spy on competitor companies, according to the Independent.

The newspaper reported that the tax authority’s letter said that the way the alleged spies were being paid constituted money-laundering and that some payments came from “offshore sources.”


Schneider Unit Ordered to Pay $10.8 Million Patent Award

A $10.8 million infringement verdict a Nevada jury returned in favor of Server Technology Inc. in an eight-year-old patent infringement case didn’t include any lost profit because the jurors found there was none.

According to the jury verdict form, Reno, Nevada-based Server Technology Inc. didn’t lose any profits related to American Power Conversion Corp.’s infringement of two patents related to power distribution plug strips used in data centers.

The jury did find that Rueil-Malmaison, France-based Schneider Electric SA’s American Power unit copied the invention and that Server Technology was entitled to the $10.8 million as a reasonable royalty.

The case is Server Technology Inc. v. American Power Conversation Corp, 06-cv-00698, U.S. District Court, District of Nevada (Reno).

Taiwan Semiconductor Manufacturing Sues Zond Over Patents

Taiwan Semiconductor Manufacturing Co., which agreed to build computer chips for Intel Corp., filed a pre-emptive lawsuit in Delaware federal court June 8 to block patent licensor Zond LLC from claiming infringement on six U.S. patents for microchip-making.

The Hsinchu, Taiwan-based chipmaker contends Zond, based in Dover, Delaware, is using basic, “one size fits all” patents to garner licensing fees and settlements “that bear no reasonable relation to the value, if any” of the patents.

Roman Chistyakov of Andover, Massachusetts, the president and co-founder of Zond, wasn’t immediately available to comment on the lawsuit.

Intel is trying to expand into the market for tablet chips, and last month said Taiwan Semiconductor would make some of the products used in low-cost tablet computers.

The case is TSMC Technology Inc. v. Zond LLC, 14-cv-00721, U.S. District Court, District of Delaware (Wilmington).

For more patent news, click here.


Tata Motors Sues Auto Products Makers for Infringement in India

Tata Motors Ltd., India’s biggest automaker, filed a trademark complaint in a Delhi court against unidentified makers of automotive accessories and related products, the CarWale automotive news website reported.

The automaker told the court the infringers are applying the Tata name to their products and seem to have in hand devices and machinery for creating the false trademarks, according to CarWale.

For more trademark news, click here.


Kim Dotcom Offers $5 Million for Help Winning U.S. Piracy Case

Kim Dotcom, the founder of Megaupload, offered $5 million to anyone who can help him successfully fight a criminal copyright-infringement case in the U.S., the U.K.’s Telegraph newspaper reported.

U.S. authorities are trying to extradite Dotcom from New Zealand, according to the newspaper.

Dotcom said his offer includes financial bounties to those who bring him anything useful in his legal battle, the Telegraph reported.

Content owners including music and movie companies, claiming Dotcom has cost them $500 million, are seeking to have his assets frozen while they pursue their civil actions against him, according to the Telegraph.

For more copyright news, click here.

To contact the reporter on this story: Victoria Slind-Flor in San Francisco at

To contact the editors responsible for this story: Michael Hytha at Charles Carter, Stephen Farr

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