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Lucent scientists charged with stealing secrets

Wed, 05/02/2001 - 8:00pm
Anne Kerven

Two scientists from Lucent Technologies were arrested and charged today with conspiring to steal proprietary source code and software from Lucent.

Lucent employees Hai Lin and Kai Xu were arrested at their homes by the FBI. Also arrested was Yong-Qing Cheng, a naturalized Chinese-American and vice president of Village Networks, an optical networking vendor in Eatontown, N.J. Cheng was arrested at Village Networks, the U.S. attorney's office reports.

The two Chinese nationals worked at the Murray Hill location on business visas and were involved in Lucent's PathStar Access Server. According to a criminal complaint filed in the U.S. District Court for the District of New Jersey, the three allegedly sought to use the stolen technology to create the leading data networking company in the People's Republic of China, calling it the "Cisco of China."

Lucent spokeswoman Mary Lou Ambrus told CEDaily the PathStar project had been discontinued in February as part of the company's restructuring.

The company has a system to protect trade secrets, "and it worked," she said.

An affidavit says the FBI obtained e-mail allegedly planning the theft and transfer of Lucent's technology to create a server identical to Lucent's PathStar.

The two scientists were designated Distinguished Members of Lucent's technical staff and both were experts at the code, software and design in the system.

The three were charged with conspiracy to commit wire fraud. Also charged was ComTriad Technolgies Inc., a New Jersey corporation founded last year by the three, which had been negotiation a joint venture with Datang Telecom Technology Co. of Beijing, majority owned by the Chinese government, the U.S. Attorney's office reports.

Lucent's technology was stored and password protected on ComTriad's Web site, the U.S. Attorney reports, and the three allegedly transferred the data earlier this year to Datang to be used in developing a ComTriad system, the CLX 1000, which was identical to PathStar.

U.S. Attorney's representatives could not be reached by CEDaily deadline.

Teligent to NASDAQ: Don't delist us.

Teligent Inc. has requested a hearing with a NASDAQ Listing Qualifications Panel to ask the exchange not to delist its stock on the NASDAQ National Market. Teligent says it has no assurance it will get the hearing or the continuation.

The company was notified on April 25 that it had failed to maintain a minimum bid price of $5 a share for the previous 30 trading days as required, and its securities were subject to delisting.

Teligent has undergone significant changes in the past week as Liberty Media sold its 33.7 percent stake in Teligent to IDT, which replaced Teligent Chair and CEO Alex Mandl with two IDT execs. Teligent on Monday also reported a two-week extension on its $350 million loan.

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