The race to find a vaccine for COVID-19 has been an impressive testament to science across the globe. Such innovations like the vaccine and others are vital to society. But such successes can also make companies targets for theft of their intellectual assets. By taking this information through illegal means – stealing the technology or know how — competitors can get a leg-up. They can bring a product to market more quickly and cheaply because they did not have to spend the time and resources developing it.
Intellectual property theft is a frequent topic of discussion at the international level, with fears of foreign companies or governments engaging in such espionage. A company deciding whether to invest in a given country will consider how well protected its intellectual property will be. At this level, the United States is a staunch defender of intellectual property, working to defend protections for US companies operating abroad. Support for intellectual property internationally is bipartisan given the incredible technological and information innovation from U.S. companies that helps drive our economy.
Domestic companies are not immune to intellectual property misappropriation, however. These issues arise within the United States, too. You can bet that many have tried to obtain the secret formula for Coca-Cola, likely (and paradoxically) the world’s most famous trade secret. Such theft is wrong, and punishing a wrongdoer seems appropriate.
There may be collateral consequences, however, to holding parties accountable for their illegal acts, such as closing of plants or infringing companies losing business. That is unfortunate but a necessary aspect of protecting these assets.
Some have suggested, though, that those impacts should somehow excuse the theft. This dynamic has arisen here in Georgia, where a trade secret dispute could impact the development of a lithium car battery plant in the city of Commerce. SK Innovation is the company building the plant but has been accused of misappropriating the trade secret on those batteries from LG Chem.
The case is pending before the US International Trade Commission (ITC), which hears cases about intellectual property violations from the importation of goods into the United States. I am indifferent to the outcome in this case, and SK Innovation could be vindicated ultimately. Even if the case is decided next week, as expected, it likely will be appealed. A final resolution is not around the corner.
But a victory for SK Innovation should not be because of fears of the economic impact in Georgia. The sentiment has arisen that wrongdoing by SK Innovation should be mitigated, if not forgiven, because of the potential economic impact on Georgia. The Jackson County Board of Commissioners, where the plant is being built, requested the ITC consider the tax and job impact in assessing the case. In some ways, they are painting themselves as a victim of the litigation.
In some ways, the Board is correct: they are truly innocent in this situation yet may be harmed by the outcome. So is the state of Georgia. Nevertheless, it would be odd to excuse the true wrongdoer and deny protection to another victim, the person whose ideas were stolen.
Such an approach could be shortsighted. A company’s decision to invest in an area is not only an international consideration. Companies may look at Georgia and wonder if their intellectual property will be discounted if another company steals, so long as Georgia benefits from that theft. Companies want to know that their valuable intellectual property will be valued and protected
Another odd incentive could arise if the economic impact could be used to excuse wrongdoing. If a company can steal trade secrets effectively get away with it under similar scenarios, then there is an even greater incentive to misappropriate trade secrets and other intellectual assets. That outcome would result in a considerable loss of value in intellectual property, key assets for US companies.
Georgia and Commerce undoubtedly could be harmed, and they are truly innocent in this legal dispute. They had no reason to know of SK Innovation’s potential bad acts. But they aren’t the only victim. LG Chem would be as well because their assets have been stolen.
It bears repeating, though, that if the ITC concludes that SK Innovation committed trade secret misappropriation, then it is the wrongdoer. Georgia and Commerce should be upset with SK Innovation and not LG Chem for protecting itself. Hopefully, Commerce can seek redress from SK Innovation directly.
Intellectual property rights help drive the engine of innovation that has made the United States an economic powerhouse. We should be careful to value and protect them both internationally and domestically.
Timothy R. Holbrook is Asa Griggs Candler Professor of Law at Emory University and an expert in intellectual property law. The views expressed are his and his alone.