On April 30, 2015, Kolon Industries Inc. (“Kolon”), a South Korean company, agreed to pay $360 million to E.I. du Pont de Nemours and Co. (“DuPont”) after a lengthy trade secrets dispute over Kevlar technology.
On September 21, 2009, DuPont sued Kolon in the U.S. District Court for the Eastern District of Virginia. Subsequently, Judge Robert Payne issued a spoilation-of-evidence order, adverse-inference jury instruction and attorneys fees for DuPont in response to Kolon’s intentional destruction of evidence. In 2011, the jury awarded $919 to DuPont. In 2014, the Fourth Circuit overturned the jury verdict on the ground that Kolon was wrongly prevented from presenting trial evidence and assigned the case to a new judge.
Meanwhile, two former DuPont employees plead guilty to the involvement with the trade secret misappropriation in 2009 and 2014, and five former Kolon executives and employees where charged in 2012. Kolon finally started settlement talks with DuPont in light of the parallel jury trials in both civil and criminal courts.
Kolon pled guilty to conspiracy for stealing the Kevlar trade secrets. In turn, the company was sentenced to pay $85 million in criminal fines and $275 million in restitution damages in Eastern District of Virginia court. This was a land mark case for the U.S. Department of Justice as the first instance where a foreign corporation without direct presence in the United States was directly served with a U.S. criminal process based on an international treaty.