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American Superconductor files intellectual property suit against Chinese company

American Superconductor Corp. has filed an intellectual property suit against a Chinese company seeking over $1.2 billion. American Superconductor claims that a Chinese wind turbine producer has stolen its technology.

The Devens, Massachusetts firm has filed several intellectual property suits against Sinovel Wind Group Co. of Beijing alleging theft of trade secrets and copyright infringement. Proceedings for the case including arbitration are expected to begin in December. American Superconductor hopes to recover $70 million owed for past shipments and $700 million in undelivered parts.

American Superconductor makes control systems for wind turbines and other technologies used by utilities. The American company began to suspect that the Chinese company was stealing its technology in June after American Superconductor discovered a flawed copy of its software in a Sinovel wind turbine in China. The discovery was made months before Sinovel stopped accepting shipments of parts produced by American Superconductor.

An investigation revealed that an engineer working for an American Superconductor subsidiary in Austria was stealing the company’s technology secrets. The worker was later found guilty of stealing proprietary software and sentenced in Austrian to one year in jail.

The Chinese company denies American Superconductor’s claims and argues that the American firm’s products have become inferior and no longer meet the standards required for China’s power grid. Sinovel has filed a counterclaim for breach of contract.

A representative for American superconductor say they have evidence that shows high-level Sinovel employees knew the technology was obtained illegally.

The arbitration between the two companies will be conducted through the Beijing Arbitration Commission.

Source: boston.com, “American Superconductor seeks $1.2 billion from Chinese firm,” Erin Ailworth, Nov. 11, 2011

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