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United States v. Lucy Xi

United States District Court, E.D. Pennsylvania

August 1, 2018

UNITED STATES OF AMERICA
v.
LUCY XI, Defendant.

          OPINION

          Slomsky, J.

         I. INTRODUCTION

         On May 24, 2017, a forty-five count Superseding Indictment was returned against the five Defendants, Yu Xue, Tao Li, Yan Mei, Tian Xue, and Lucy Xi. Defendant Lucy Xi is charged with conspiracy to commit wire fraud in violation of 18 U.S.C. § 1349 (Count 1); conspiracy to steal trade secrets in violation of 18 U.S.C. § 1832(a)(5) (Count 2); wire fraud in violation of 18 U.S.C. § 1343 (Counts 4-19); and theft of trade secrets in violation of 18 U.S.C. § 1832(a) (Counts 23-25). (Doc. No. 125.) The charges stem from an alleged conspiracy to steal confidential and trade secret information from GlaxoSmithKline, LLC (“GSK”) for the use of a rival corporation, Renopharma, Ltd., created in China.

         Before the Court is Defendant Lucy Xi's Motion to Dismiss for Prosecutorial Misconduct or, in the Alternative, Motion to Sever. (Doc. No. 159.) First, Defendant Xi contends that the charges against her in the Superseding Indictment should be dismissed because a Government agent has admitted that Defendant Xi had no malicious intent to steal trade secrets but that the Government still charged her in an attempt to coerce her cooperation against the other Defendants. (Id. at 5.) Alternatively, Defendant Xi contends that her trial should be severed from that of her co-Defendants because she would face a substantial risk of prejudice if she is tried with them. (Id.)

         The Government has filed a Response to her Motion (Doc. No. 165), and Defendant Xi has filed a Reply (Doc. No. 179). On April 30, 2018, the Court held a hearing on all pretrial Motions, including the instant Motion to Dismiss and Motion to Sever. For reasons that follow, Defendant Xi's Motion to Dismiss and Motion to Sever (Doc. No. 159) will be denied.

         II. BACKGROUND

         From July 14, 2008 to November 3, 2015, Defendant Lucy Xi was employed as a scientist at GSK. (Doc. No. 125 at 7 ¶ 16.) In 2015, she moved to Thousand Oaks, California to work for Amgen, a biotechnology company. (See Doc. No. 186, Ex. A.) On December 29, 2015, the Government filed a Criminal Complaint against Defendants Yu Xue, Tao Li, Yan Mei, Tian Xue, and Lucy Xi charging them with conspiracy to commit wire fraud in violation of 18 U.S.C. § 1349. (Doc. No. 1.) That same day, warrants for the arrest of Lucy Xi and the other four Defendants were issued by a United States Magistrate Judge. On January 5, 2016, FBI Special Agents David Winsett, Lisa Grover, and Jeremy Creed arrested Defendant Xi at Amgen and subsequently interviewed her. (Doc. No. 186, Ex. A.)

         A. Agent David Winsett's Conversation with the Amgen Representative[1]

         After the Agents had finished interviewing Defendant Xi and before they left to take her to downtown Los Angeles for her initial court appearance, Agent Winsett spoke with four Amgen representatives. Agent Winsett said to one Amgen representative, “Okay. So we're about to leave. Things [are] going pretty well. She's being very cooperative. She's waived her right to [an] attorney.” (Id. at 37.) He explained that they had to get her to downtown Los Angeles by noon “to get her processed” and discussed with the Amgen representative the best way to get Defendant Xi out of the building. (Id. at 37-38.)

         Next, Agent Winsett asked one of the Amgen representatives about Defendant Xi's status at Amgen. (Id. at 39.) The Amgen representative explained that she would be put on paid administrative leave, and her housing and pay would not be affected “until something comes out of this, from a conclusion standpoint.” (Id.) Agent Winsett said, “Well, that's very generous of the company so, um, and we'll keep in touch with you and let you know how [it] proceed[s].” (Id. at 40.)

         The Amgen representative then asked Agent Winsett if Agent Winsett could give him some information regarding the allegations against Defendant Xi and explained that he had a meeting with Amgen executives that afternoon. (Id. at 40.) Agent Winsett agreed to provide him information and explained as follows:

[Winsett]: Um, so, essentially-[she seems], you know, there's an issue of proprietary information from GlaxoSmithKline. Um, we showed her some information. Um, she claimed that it was research for uh, her PhD she's getting- she was studying for her PhD back when she was with them, and I don't know if there's any truth to that or not. Um, but anyways, she may have suspected that those group of individuals were doing something that, you know, she shouldn't have been a part of and she['s] on the outs, she's like this close to being divorced from her ex husband, who is one of the main subjects in this.
[Amgen Representative 3]: O k a y .
[Winsett]: And so, he was kind of-I think she's, to be honest, I think she[] could be naïve about the whole situation. She's not real clear about what's there's and what's-
[Amgen Representative 3]: So it's pretty much how you outlined it [initially that]-
[Winsett]: Yeah.
[Amgen Representative 3]: She's a small fish and-
[Winsett]: Yeah.
[Amgen Representative 3]: You're trying to flip her.
[Winsett]: Exactly. And so, right now, it's hard to gauge but we don't believe that there's like, I guess, malicious intent to [to], you know, rob Glaxo and then go, you know, make millions. We think the other group of individuals, they had planned to do that and were willing and want[ing] to do that so, she's gonna be actually a great witness for us. I think, we just need to kinda keep her in the corral.

(Id. at 40-41.)

         Agent Winsett then asked whether Amgen had investigated Defendant Xi's activities at the company. (Id. at 41.) The Amgen representative stated that he had authorized an investigation but did not want to initiate anything until after the arrest. (Id.) He continued, “[b]ecause we got that guys that, (UI)[2] was looking at it . . . [and our I.S.] group, which is part of the, uh, Asian cast-” (Id. at 42.) Agent Winsett responded, “Oh, right, right, ” and recommended that Amgen investigate Defendant Xi's activities, stating, “Okay. Yeah, so just, just for both of our benefits to know she's not pulling the ‘I'm so innocent,' kind of card and you know she's a shark or something.” (Id.) The Amgen representative responded that he did not see a long future for Defendant Xi at Amgen but confirmed that for the time being, her housing and pay would not be affected. (Id. at 42-43.)

         Agent Winsett ended the conversation, and the Agents drove Defendant Xi to downtown Los Angeles. On January 20, 2016, a grand jury returned a forty-three count Indictment against Defendants, charging conspiracy to commit wire fraud, conspiracy to steal trade secrets, conspiracy to ...


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