© Reuters. FILE PHOTO: Siemens Energy AG goes public after IPO
By Mike Spector NEW YORK (Reuters) – General Electric (NYSE 🙂 Co has accused a Siemens Energy AG subsidiary of using stolen trade secrets to rig bids for lucrative gas turbine utility contracts and concealing improper business profits from a total of more than $ 1 billion, according to a lawsuit filed Thursday. GE sued rival company Siemens Energy Inc in a U.S. district court in Virginia, alleging the theft dates back to May 2019, when industrial conglomerates tendered to provide gas turbine equipment and service to Dominion Energy Inc. Dominion is a Virginia electric power company. which provides electricity to some 4 million customers on the east coast. The lawsuit arises from Siemens AG (OTC 🙂 spinning off its energy business to create Siemens Energy. GE alleges that Siemens Energy used trade secrets improperly received from a Dominion employee in part to win contracts that would raise the price of its initial public offering that took place in September. A Siemens Energy spokesperson did not immediately comment, and the Dominion representative did not immediately respond to requests for comment. In the course of GE’s offer to do business with Dominion, according to the lawsuit, a senior Dominion employee began submitting confidential business information that GE had submitted to a Siemens account manager. The information also included Dominion’s analysis of all bids, giving Siemens a “blueprint” to win contracts worth up to $ 340 million with the utility company, known as the Peakers Project, GE alleged. The recipient of GE’s trade secrets at Siemens passed the information on to colleagues including those who were preparing the Dominion offering, which they used to help win the business, according to the lawsuit. The Dominion employee, who no longer worked there, passed the information to the Siemens manager at least half a dozen times, in some cases forwarded from his personal email address to that of the Siemens manager’s wife, according to the lawsuit. . The employee at the receiving end remains at Siemens, according to the lawsuit. In a tender package, GE had provided Dominion with technical specifications for four gas turbine models, prices for different combinations of equipment and details on how the company would service and maintain it, the lawsuit claims. Gas turbines are combustion engines that become power generators that supply electricity to large residential and commercial developments. Siemens only alerted GE to the improper receipt of the trade secrets 16 months later, in September, through what GE described as a “nothing to see here, folks” letter that downplays the infringement, the suit alleges. The alert came after Siemens completed its own internal investigation and Dominion completed its own investigation, the suit claims. Dominion alerted GE to the alleged misconduct before Siemens did, according to the lawsuit. GE asked a judge to stop Siemens from using the allegedly stolen material and to pay damages totaling hundreds of millions of dollars or more. The litigation is the latest legal battle involving corporate rivals, who have faced each other in patent infringement lawsuits as recently as last year. The alleged theft has put GE at a disadvantage by competing for upcoming contracts worth at least $ 120 million each, the lawsuit claims. GE and Siemens are competing on another Dominion bid that expires on January 19, adding urgency to resolve the theft allegations, according to the lawsuit. Since receiving the information incorrectly in May 2019, Siemens has won eight other gas turbine tenders over competing GE proposals valued at more than $ 1 billion, according to the lawsuit. In most of those proposals, GE offered some of the same gas turbine models from the Dominion project and, in one case, equipment with similar specifications, based on demand. According to GE, the Siemens employee who received the trade secrets passed them on to numerous colleagues, some of whom played a key role in preparing other gas turbine deals. GE lost Dominion’s bid to Siemens in July 2019 without explanation, the lawsuit alleges, and Siemens employees continued to disseminate and use GE trade secrets to tailor at least two additional gas turbine proposals. Siemens has also “steadfastly refused” to assure GE that the documents containing the trade secrets have been destroyed, the suit claims.