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Charges dropped against 2 former Lilly scientists

December 6, 2014

INDIANAPOLIS (AP) — Two former Eli Lilly and Co. employees who were accused of sending trade secrets worth more than $55 million to a competing Chinese drug company will no longer face charges, the U.S. attorney’s office announced Friday.

Acting U.S. Attorney Josh Minkler said in a motion filed in U.S. District Court that the case was being dismissed “in the interests of justice.” A spokesman for his office declined further comment.

The case against Guoqing Cao and Shuyu Li collapsed after Indianapolis-based Lilly provided additional information to the U.S. Department of Justice that changed “the investigative facts initially relied upon by the government” in its case, according to court documents.

Cao and Li were arrested Oct. 1, 2013, and charged with theft and conspiracy to commit theft involving drugs for cardiovascular disease, diabetes and cancer that Lilly was developing. The charges were modified in March to one count each of wire fraud, aiding and abetting and count of conspiracy to commit wire fraud.

The indictment alleged Cao and Li emailed sensitive information about nine experimental drug research programs at Lilly to a third man, also a former Lilly scientist, when he was employed by Jiangsu Hengrui Medicine Co. Ltd. in China.

U.S. Attorney Joe Hogsett and his deputy, Cynthia Ridgeway, characterized the case as a crime against the nation and the defendants as traitors at the time of the indictments.

The two men repeatedly denied any wrongdoing.

The Indianapolis Business Journal reported (http://bit.ly/1yoC1xE ) that in October, lawyers for Cao received material about statements made by Robert Titus, a patent lawyer at Lilly. Titus had changed his original statements about the case, according to a letter written by Indianapolis attorney David Hensel.

“This is highly material to the defense as it appears that the false accusations by Mr. Titus formed the basis of a search warrant application made by the government early in its investigation, leading to the collection of evidence deemed important by the government,” Hensel wrote in an Oct. 6 letter to Ridgeway, the assistant U.S. attorney acting as prosecutor on the case.

Hensel also noted that the former Lilly computer expert who had analyzed Cao’s computer notified the FBI in May that he no longer had the hard drive to which he had copied files from Cao’s computer.

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Information from: Indianapolis Business Journal, http://www.ibj.com

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