LONDON — Vacuum powerhouse Dyson filed legal proceedings Wednesday against Bosch in Britain’s High Court, accusing its German rival of having obtained corporate secrets through a mole within a high-security research and development department.
Dyson, known for its popular bagless vacuum cleaner, claims that a rogue engineer working in its facility in Malmesbury for Dyson digital motors was handing information on “secret motor technology” to Bosch for up to two years.
“Dyson has confronted Bosch with evidence of wrongdoing but it has refused to return the technology. Nor has it promised not to use the technology for its benefit, forcing Dyson to take legal action,” the company said in a statement.
Dyson alleges that Bosch paid the mole through an unincorporated business created solely for that purpose and that Bosch’s vice president, Wolfgang Hirschburger, was aware of the engineer’s work.
Mark Taylor, Dyson Research and Development director, said that Bosch had benefited from Dyson’s know-how and expertise.
“We have spent over 15 years and 100 million pounds ($160.2 million) developing high-speed brushless motors, which power our vacuum cleaners and Airblade hand dryers,” he said in a statement. “We are demanding the immediate return of our intellectual property.”
Bosch disputed some of the facts. It said in a statement that Dyson had employed an individual with a pre-existing consultancy agreement with Bosch Lawn and Garden Ltd. in relation to garden products — “and not vacuum cleaners or hand dryers as Dyson implies.”
The company expressed regret that Dyson has pursued legal action, saying it has been trying to establish what happened and what, if any, confidential information was supposedly passed between the companies.
SAN FRANCISCO (Reuters) – A White House-ordered review of security risks posed by suppliers to U.S. telecommunications companies found no clear evidence that Huawei Technologies Ltd had spied for China, two people familiar with the probe told Reuters.
Instead, those leading the 18-month review concluded early this year that relying on Huawei, the world’s second-largest maker of networking gear, was risky for other reasons, such as the presence of vulnerabilities that hackers could exploit.
These previously unreported findings support parts of a landmark U.S. congressional report last week that warned against allowing Chinese companies Huawei and ZTE Corp to supply critical telecom infrastructure.
But it may douse speculation that Huawei has been caught spying for China.
Some questions remain unanswered. For example, it is unclear if security vulnerabilities found in Huawei equipment were placed there deliberately. It is also not clear whether any critical new intelligence emerged after the inquiry ended.
Aided by intelligence agencies and other departments, those conducting the largely classified White House inquiry delved into reports of suspicious activity and asked detailed questions of nearly 1,000 telecom equipment buyers, according to the people familiar with the probe.
“We knew certain parts of government really wanted” evidence of active spying, said one of the people, who requested anonymity. “We would have found it if it were there.”
White House National Security Council spokeswoman Caitlin Hayden declined to comment on the review. A spokesman for Huawei said the company was not familiar with the review but it was not surprised that no evidence of Huawei espionage was found.
Last week’s report from the Republican and Democratic leaders of the House Intelligence Committee noted the potential for spying through Huawei gear installed to manage traffic on wireless networks. The committee also criticized Huawei’s leadership for failing to provide details about its relationships with Chinese government agencies.
Huawei, whose chief executive officer, Ren Zhengfei, founded it 25 years ago after he was laid off by the Chinese army, has rejected the House report as unfair and inaccurate. China’s Commerce Ministry has also called the accusations “groundless.”
“Huawei is a $32 billion independent multinational that would not jeopardize its success or the integrity of its customers’ networks for any government or third party. Ever,” the company’s U.S. spokesman Bill Plummer said on Wednesday.
The House Intelligence Committee’s report did not present concrete evidence that either Huawei or ZTE have stolen U.S. data, although it said a classified annex provided “significantly more information adding to the committee’s concerns” about the risk to the United States.
Speculation has swirled about the contents of the secret annex, and both committee Chairman Mike Rogers and some intelligence officials have hinted at evidence that Huawei has participated in espionage.
Rogers, the report’s lead author, stoked concerns by saying some customers had seen routers sending off “very valuable data” to China.
But in the one case a committee staff member pointed out to Reuters, the victim – Leap Wireless International Inc – said that while some of its computers were infected with viruses earlier this year, an investigation found no evidence that the infection was deliberate or that confidential data had been stolen.
PREVENTIVE MEASURES
Pressed about why the White House review and unclassified version of the House Intelligence Committee report had not turned up a “smoking gun,” two officials familiar with intelligence assessments said U.S. agencies were most concerned about the capability for future spying or sabotage.
Similarly, Chris Johnson, a former CIA analyst on China, said he had been told that the White House review had come up empty on past malicious acts. Nonetheless, officials emerged from the review with “a general sense of foreboding” about what would happen if China asked Huawei for assistance in gathering intelligence from U.S. customers, he said.
“If the Chinese government approached them, why would they say no, given their system?” Johnson said.
Preventing state spying through technology is a high priority for U.S. President Barack Obama’s administration, which is lobbying for legislation to raise private-sector security standards and readying a more limited executive order along those lines.
Reuters interviews with more than a dozen current and former U.S. government officials and contractors found nearly unanimous agreement that Huawei’s equipment poses risks: The company could send software updates that siphon off vast amounts of communications data or shut them down in times of conflict.
More than anything else, cyber experts complained about what they said was poor programming that left Huawei equipment more open than that of rivals to hacking by government agents or third parties.
“We found it riddled with holes,” said one of the people familiar with the White House review.
At a conference in Kuala Lumpur last week, Felix Lindner, a leading expert in network equipment security, said he had discovered multiple vulnerabilities in Huawei’s routers.
“I’d say it was five times easier to find one in a Huawei router than in a Cisco one,” Lindner said.
Lindner, who spent months investigating Huawei code, said the vulnerabilities appeared to be the result of sloppy coding and poor procedures, rather than any deliberate attempt at espionage. Huawei is looking into his findings, he said.
Some in the U.S. government, however, have said the alleged poor security practices at Huawei could be a deliberate cover for future attacks.
One computer scientist, who helped conduct classified U.S. government research on Huawei routers and switches four to six years ago, told Reuters that he had found “back doors” that his team believed were inserted with care.
He said these back doors could enable attackers to install malicious software that would make critical government networks inoperable, allow hackers to gain entry into highly classified systems and enable them to spy on all traffic. He requested anonymity because he was not authorized to discuss the research.
Huawei has denied the existence of these back doors. Plummer also noted that any vendor’s gear could be targeted by hackers, and the company would address any vulnerabilities it finds.
The United States’ closest allies have rendered a split verdict on Huawei. Earlier this year, Australia barred Huawei from becoming a contractor on the country’s National Broadband Network, and Canada said last week that Huawei could not bid to help build a secure national network. In Britain, however, a spokesman for the Cabinet Office said Huawei’s products were fully vetted and did not represent a security concern.
Dutch Ruppersberger, the ranking Democrat on the House Intelligence Committee and co-author of the report, told Reuters that the burden of proof had been on Huawei and ZTE, which cited Chinese government restrictions in limiting their responses.
“China has the means, opportunity, and motive to use telecommunications companies for malicious purposes,” Ruppersberger said.
Republican Rogers’ staff did not respond to questions about the contents of the classified annex or the White House review.
(Reporting by Joseph Menn in San Franciso, Jim Finkle in Boston, and Mark Hosenball in Washington; Additional reporting by Paul Eckert and Jim Wolf in Washington and Jeremy Wagstaff in Kuala Lumpur; Editing by Tiffany Wu and Lisa Von Ahn)
Nippon Steel Sumitomo Metal Corp. says its lawsuit against South Korean steelmaker Posco has broader implications for other domestic businesses whose technology is leaked.
During the first session at the Tokyo District Court on Thursday, Posco categorically denied stealing technological secrets, but Nippon Steel Sumitomo Metal claims it has solid evidence detailing the company’s industrial espionage in the alleged theft of manufacturing knowhow related to a specialty steel product. It is pressing for ÂĄ98.6 billion in damages and an injunction to block Posco from producing it.
The Japanese firm became the world’s second-largest steelmaker with a 30 percent market share through the Oct. 1 merger of Nippon Steel Corp. and Sumitomo Metal Industries Ltd., while Posco has the fifth-largest global share, at around 20 percent. Each firm dominates its respective domestic market, and the two have also worked together as strategic partners since 2000 in research and product development.
The alleged theft concerns so-called grain-oriented electrical steel sheets, which are used in the core part of voltage transformers in the transmission of electricity to households. The now-defunct Nippon Steel used to be the market leader for the product after developing technology that boosted the efficiency of power transmission in the 1990s, although Posco has increased its presence in the sector since 2005.
Nippon Steel Sumitomo Metal says its suit focuses on five sets of technology-related documents it claims were leaked to Posco by former Japanese employees. The documents are known to have been sold by a former Posco employee to China’s Baoshan Iron Steel Co. for 5 billion won (about ÂĄ365 million).
South Korean media outlets lashed out at the Posco employee after the country’s criminal courts handed down a guilty verdict in 2008. During that trial, it was proven that the titles of the five documents were written in Japanese and were identical to those of Nippon Steel.
The Japanese steelmaker claims any suggestion of a coincidence “is absolutely unnatural. It just means the documents held by Posco were leaked” from Nippon Steel.
Nippon Steel Sumitomo Metal alleges that four Nippon Steel employees who retired during the 1980s and 1990s contacted Posco and sold it the documents in question. It has also lodged an ÂĄ80 billion damages suit against one of them, whom the company argues played the central role in the sale.
“We have in our hands specifics, such as the amount of compensation paid and details of the contact made. But we are not divulging them until the right time,” Nippon Steel Sumitomo Metal said.
However, Posco argues “it has hardly been made clear who contacted who and the date and time of such contact.”
Nippon Steel Sumitomo Metal is represented by Nishimura Asahi, while Posco has retained Abe, Ikubo Katayama. Both law firms are known for their expertise in intellectual property cases, and court arguments are likely to be vicious.
Japanese companies usually do not contest cases of industrial espionage vigorously, believing trials could further undermine their competitiveness.
“It is an important lawsuit in which the future of Japanese businesses is at stake,” a senior official at Nippon Steel Sumitomo Metal said. “It’s the best opportunity to show both domestically and internationally that industrial espionage in Japan does not pay.”
Verizon Wireless will soon start spying on its customers.
The telecom giant recently updated its privacy policy, allowing the company to share more data with advertisers, and several customers have equated the change with spying.
Verizon will know what websites you visit and how frequently you visit them as well as the location of your phone. The company said that its new monitoring practices will allow it to provide customers with more relevant ads.
“A local restaurant may want to advertise only to people who live within 10 miles, and we might help deliver that ad on a website without sharing information that identifies you personally.”
Getting customers connected with local businesses sounds like a good idea, but several people are concerned about Verizon’s spying practices. According to iDigital Times, the tracking function is enabled by default on Verizon phones.
If you don’t want to let Verizon use your data for marketing purposes, you can log into your account and go to Verizon’s privacy center. On that page, you should find a button that allows you to opt out of the program.
Verizon said in a press release that its new spying practices will allow it to give businesses a detailed look at their customers. For example, Verizon will be able to determine the users demographic (age, gender, race), their interests (pet owner, tennis player), and their most frequent locations (which could help companies determine billboard placements).
What do you think about Verizon’s new spying practices? Are you comfortable with the telecom giant knowing your web history and your location? Are you looking forward to seeing more relevant ads?
SAN FRANCISCO (Reuters) – A White House-ordered review of security risks posed by suppliers to U.S. telecommunications companies found no clear evidence that Huawei Technologies Ltd had spied for China, two people familiar with the probe told Reuters.
Instead, those leading the 18-month review concluded early this year that relying on Huawei, the world’s second-largest maker of networking gear, was risky for other reasons, such as the presence of vulnerabilities that hackers could exploit.
These previously unreported findings support parts of a landmark U.S. congressional report last week that warned against allowing Chinese companies Huawei and ZTE Corp to supply critical telecom infrastructure.
But it may douse speculation that Huawei has been caught spying for China.
Some questions remain unanswered. For example, it is unclear if security vulnerabilities found in Huawei equipment were placed there deliberately. It is also not clear whether any critical new intelligence emerged after the inquiry ended.
Aided by intelligence agencies and other departments, those conducting the largely classified White House inquiry delved into reports of suspicious activity and asked detailed questions of nearly 1,000 telecom equipment buyers, according to the people familiar with the probe.
“We knew certain parts of government really wanted” evidence of active spying, said one of the people, who requested anonymity. “We would have found it if it were there.”
White House National Security Council spokeswoman Caitlin Hayden declined to comment on the review. A spokesman for Huawei said the company was not familiar with the review but it was not surprised that no evidence of Huawei espionage was found.
Last week’s report from the Republican and Democratic leaders of the House Intelligence Committee noted the potential for spying through Huawei gear installed to manage traffic on wireless networks. The committee also criticized Huawei’s leadership for failing to provide details about its relationships with Chinese government agencies.
Huawei, whose chief executive officer, Ren Zhengfei, founded it 25 years ago after he was laid off by the Chinese army, has rejected the House report as unfair and inaccurate. China’s Commerce Ministry has also called the accusations “groundless.”
“Huawei is a $32 billion independent multinational that would not jeopardize its success or the integrity of its customers’ networks for any government or third party. Ever,” the company’s U.S. spokesman Bill Plummer said on Wednesday.
The House Intelligence Committee’s report did not present concrete evidence that either Huawei or ZTE have stolen U.S. data, although it said a classified annex provided “significantly more information adding to the committee’s concerns” about the risk to the United States.
Speculation has swirled about the contents of the secret annex, and both committee Chairman Mike Rogers and some intelligence officials have hinted at evidence that Huawei has participated in espionage.
Rogers, the report’s lead author, stoked concerns by saying some customers had seen routers sending off “very valuable data” to China.
But in the one case a committee staff member pointed out to Reuters, the victim – Leap Wireless International Inc – said that while some of its computers were infected with viruses earlier this year, an investigation found no evidence that the infection was deliberate or that confidential data had been stolen.
PREVENTIVE MEASURES
Pressed about why the White House review and unclassified version of the House Intelligence Committee report had not turned up a “smoking gun,” two officials familiar with intelligence assessments said U.S. agencies were most concerned about the capability for future spying or sabotage.
Similarly, Chris Johnson, a former CIA analyst on China, said he had been told that the White House review had come up empty on past malicious acts. Nonetheless, officials emerged from the review with “a general sense of foreboding” about what would happen if China asked Huawei for assistance in gathering intelligence from U.S. customers, he said.
“If the Chinese government approached them, why would they say no, given their system?” Johnson said.
Preventing state spying through technology is a high priority for U.S. President Barack Obama’s administration, which is lobbying for legislation to raise private-sector security standards and readying a more limited executive order along those lines.
Reuters interviews with more than a dozen current and former U.S. government officials and contractors found nearly unanimous agreement that Huawei’s equipment poses risks: The company could send software updates that siphon off vast amounts of communications data or shut them down in times of conflict.
More than anything else, cyber experts complained about what they said was poor programming that left Huawei equipment more open than that of rivals to hacking by government agents or third parties.
“We found it riddled with holes,” said one of the people familiar with the White House review.
At a conference in Kuala Lumpur last week, Felix Lindner, a leading expert in network equipment security, said he had discovered multiple vulnerabilities in Huawei’s routers.
“I’d say it was five times easier to find one in a Huawei router than in a Cisco one,” Lindner said.
Lindner, who spent months investigating Huawei code, said the vulnerabilities appeared to be the result of sloppy coding and poor procedures, rather than any deliberate attempt at espionage. Huawei is looking into his findings, he said.
Some in the U.S. government, however, have said the alleged poor security practices at Huawei could be a deliberate cover for future attacks.
One computer scientist, who helped conduct classified U.S. government research on Huawei routers and switches four to six years ago, told Reuters that he had found “back doors” that his team believed were inserted with care.
He said these back doors could enable attackers to install malicious software that would make critical government networks inoperable, allow hackers to gain entry into highly classified systems and enable them to spy on all traffic. He requested anonymity because he was not authorized to discuss the research.
Huawei has denied the existence of these back doors. Plummer also noted that any vendor’s gear could be targeted by hackers, and the company would address any vulnerabilities it finds.
The United States’ closest allies have rendered a split verdict on Huawei. Earlier this year, Australia barred Huawei from becoming a contractor on the country’s National Broadband Network, and Canada said last week that Huawei could not bid to help build a secure national network. In Britain, however, a spokesman for the Cabinet Office said Huawei’s products were fully vetted and did not represent a security concern.
Dutch Ruppersberger, the ranking Democrat on the House Intelligence Committee and co-author of the report, told Reuters that the burden of proof had been on Huawei and ZTE, which cited Chinese government restrictions in limiting their responses.
“China has the means, opportunity, and motive to use telecommunications companies for malicious purposes,” Ruppersberger said.
Republican Rogers’ staff did not respond to questions about the contents of the classified annex or the White House review.
(Reporting by Joseph Menn in San Franciso, Jim Finkle in Boston, and Mark Hosenball in Washington; Additional reporting by Paul Eckert and Jim Wolf in Washington and Jeremy Wagstaff in Kuala Lumpur; Editing by Tiffany Wu and Lisa Von Ahn)
