A judge has set bail at US$900,000 apiece for two Lucent Technologies scientists and a third man accused of stealing key trade secrets from the telecommunications equipment giant.
The three - two Chinese nationals and a US citizen arrested on May 3 - were accused of conspiring to steal source code and software associated with Lucent's PathStar Access Server for transfer to a state-owned Chinese company.
Lucent suffered an US$80 million loss due to theft of the PathStar server system, which facilitates transmission of voice communication through the Internet while also providing call-waiting, speed dialing, and other telephone-related features, prosecutors said.
Although Lucent no longer uses the PathStar system, its source code was valuable to future Lucent products, they said. The case highlights the threat to US companies of economic espionage, a growing preoccupation of spies around the world since the end of the Cold War.
It also comes amid rising tensions between the United States and China, strained by the recent US spy plane landing on a Chinese island, US arms sales to Taiwan, and President George W. Bush's pledge to defend Taiwan.
The accused are scientists Lin Hai and Xu Kai, who held high-level positions at Lucent, and Chang Yong-Qing, who was vice president of Village Networks, an optical network vendor.
The three remained in a New Jersey jail while friends and family tried to raise bail, defense attorneys said.
Once freed from jail, they would be subject to electronically monitored house arrest, according to the conditions set by US Judge Stanley Chesler.
None of the three men, wearing orange jumpsuits and arm and leg shackles, spoke at the court hearing.
An FBI search of their homes turned up evidence including thousands of documents, hundreds of CD-Roms and at least a dozen computers, prosecutors said.
Several items were marked with PathStar labels, prosecutors said.
No further hearing date was set.
The Pathstar technology generated revenues of about US$100 million last year at the US$33.8 billion company, but it was discontinued in January as part of Lucent's restructuring, the company said at the time of the three men's arrest.
The three men were each charged with one count of conspiring to commit wire fraud and, if convicted, could face a maximum of five years imprisonment and a US$250,000 fine.
The men allegedly were trying to make a system identical to PathStar -they called it CLX1000 - and had successfully transferred it out of Lucent systems, officials said.
