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Stolen Data Helped Chinese Producer Quickly Commercialize Ultra High-Strength Steel, Alleges U. S. Steel
04/28/2016 - China broke into U. S. Steel's computer network and stole production research on its advanced steels, allowing at least one overseas producer to side-step years of work and quickly roll out ultra high-strength grades, U. S. Steel alleges in its Section 337 complaint before the U.S. International Trade Commission.
U. S. Steel filed the complaint on Tuesday, contending that the largest of Chinese steelmakers stole trade secrets in addition to fixing prices and circumventing trade duties through false labeling.
In the petition, U. S. Steel alleges that hackers attacked its network in January 2011 and stole several gigabytes of proprietary data. Not long after its data were stolen, China’s Baosteel commercialized a line of ultra high-strength steel and began exporting it to the U. S., the company claims.
The commercialization came in spite of problems Chinese producers were having in delivering lower grades of advanced high-strength steel, U. S. Steel said.
The company said hackers were able to enter its network through a senior researcher’s work computer and took hot-dip simulator research files, on which the company had developed and refined production techniques for its Dual-Phase 590, 780 and 980 steels.
The numbers refer to the amount of force, in megapascals, the steel can withstand.
The company said the hack “followed the pattern of previous attacks” used by the Chinese government.
In 2010, the company said, Chinese government hackers broke into U. S. Steel’s network and took other sensitive data. That incident led to federal indictments against five from China’s People’s Liberation Army.
U. S. Steel said it expects evidentiary discovery to show the Chinese government shared the stolen data with state-owned producers, allowing them to quickly commercialize competing products.
China’s Commerce Ministry said the allegations of intellectual property theft are groundless, BloombergBusiness reported. And in response to questions from The Wall Street Journal, Baosteel said the accusations are “complete nonsense.”
“Baosteel has consistently acted in accordance with regulations; respected intellectual property rights; and attached great importance to independent research and development and technological progress,” the company said, according to The Journal.
In the petition, U. S. Steel alleges that hackers attacked its network in January 2011 and stole several gigabytes of proprietary data. Not long after its data were stolen, China’s Baosteel commercialized a line of ultra high-strength steel and began exporting it to the U. S., the company claims.
The commercialization came in spite of problems Chinese producers were having in delivering lower grades of advanced high-strength steel, U. S. Steel said.
The company said hackers were able to enter its network through a senior researcher’s work computer and took hot-dip simulator research files, on which the company had developed and refined production techniques for its Dual-Phase 590, 780 and 980 steels.
The numbers refer to the amount of force, in megapascals, the steel can withstand.
The company said the hack “followed the pattern of previous attacks” used by the Chinese government.
In 2010, the company said, Chinese government hackers broke into U. S. Steel’s network and took other sensitive data. That incident led to federal indictments against five from China’s People’s Liberation Army.
U. S. Steel said it expects evidentiary discovery to show the Chinese government shared the stolen data with state-owned producers, allowing them to quickly commercialize competing products.
China’s Commerce Ministry said the allegations of intellectual property theft are groundless, BloombergBusiness reported. And in response to questions from The Wall Street Journal, Baosteel said the accusations are “complete nonsense.”
“Baosteel has consistently acted in accordance with regulations; respected intellectual property rights; and attached great importance to independent research and development and technological progress,” the company said, according to The Journal.
