Siemens Exec Charged in Conspiracy to Steal GE Trade Secrets (1)

A retired Siemens Energy executive was criminally charged in Virginia federal court for an alleged conspiracy to steal General Electric Co. and Mitsubishi Heavy Industries Ltd. trade secrets.

John Gibson allegedly helped coordinate a 2019 scheme to help Siemens win a bid to build a gas turbine plant for Dominion Energy Inc., a Tuesday federal charging document said. An employee for Siemens and one for Dominion have previously pled guilty in relation to the same matter, the US Attorney’s forfeiture allegation said.

Employees of Siemens, described in the indictment as “Company 1,” convinced a Dominion employee to share trade secrets and other confidential information from GE and Mitsubishi’s bids, and returned the favor with gifts, the document said. The information allowed Siemens to undercut the GE bid and secure the contract to build the Chesterfield, Virginia, turbine plant.

Siemens isn’t mentioned in the complaint, but Gibson’s status as a Siemens executive is also alleged in a lawsuit brought by General Electric against the company involving the events at issue. He also listed work for Siemens on his LinkedIn page—using the same professional titles and listing work from 1987 to 2020, the same period as Gibson is alleged to have worked with Company 1 in the complaint.

Seimens said in a statement that its “internal compliance function proactively discovered” the issue related to the charge in 2020. It promptly investigated with an outside law firm, disclosed it to affected competitors, and worked to isolate relevant information and remove it from its systems, the statement said. It also “took remedial measures” with respect to involved employees, “up to and including separation.”

Dominion sought bids for a company to build and maintain a “Peaker” gas turbine plant in 2019, one designed to add electricity capacity to alleviate high grid load and improve grid resiliency. It estimated the cost would be around $500 million, according to the government.

After the three companies had submitted bids, Siemens sales employee Michael P. Hillen reached out to Dominion employee Theodore S. Fasca to ask about “the numbers” of the competing bids. Fasca said he didn’t have access but could uncover it if interested, the document said.

Hillen and other Siemens employees provided Fasca and other Dominion employees with gifts including football game tickets, hotel accommodations, and dinners to influence the bid process, the charging document said. Hillen facilitated transfer of pricing information and technical specs from the bids—which were subject to nondisclosure agreements—using the conspirators’ and their spouses’ personal email addresses.

The information was passed to Gibson through another co-conspirator at Siemens, and Gibson “strategically disseminated” it to others in the company. Gibson, CEO of power generation, authorized lowering the bid to undercut the GE bid and convinced others in the company to sign off on the changes. He did not financially benefit from the conspiracy, the government said.

In a 2021 sworn deposition Gibson allegedly acknowledged that the price reduction was driven by the information on the competing bids, and that without it Siemens would “probably not” have done it, the government said. He allegedly knew the information included trade secrets that Siemens was not authorized to have.

General Electric sued Siemens in 2021 for stealing trade secrets in multiple Dominion bidding processes. Siemens initially argued GE had embellished its claims in a bid to put it at a disadvantage, calling it an “opportunistic attempt” to “exploit a specific issue with a now-canceled gas turbine project.” The companies, who litigate against each other regularly, settled the case six months later.

Fasca and Hillen were charged in June and September respectively with conspiracy to commit wire fraud, according to the criminal complaint. Each pleaded guilty within a month of being charged.

The case is US v. John Gibson, E.D. Va., No. 3:23-cr-137, Forfeiture allegation 10/24/23.