Insiders and Moles: Stealing Company Secrets…

Michael D. Moberly   November 1, 2012

As reported by the AP last week, Dyson, a large UK-based firm, known most for its bag-less and ball mounted home vacuum cleaners, filed legal proceedings against Bosch, a German competitor.

The legal action accused Bosch of having illegally obtained Dyson secrets, i.e., ‘digital motor technology’ through the efforts of an ‘insider’ working in Dyson’s R&D unit for perhaps as long as two years, according to the AP report.

Dyson spokesperson characterized this insider as a ‘rogue engineer or mole’.  On behalf of myself and numerous highly experienced (insider threat) colleagues, I’m confident we would all be hard pressed to suggest the term ‘rogue’ is an appropriate descriptor for such acts and/or behaviors.   For us, ‘rogue’ implies a single or otherwise one-off experience, whereas we, based on sound research and personal experience are inclined to characterize insider threat(s), in which there is no shortage, as being persistent, globally asymmetric, generally sophisticated technologically and personally, and come embedded with numerous tangible – intangible (personal) motivators for doing what they do.

Interestingly, the AP reported, Dyson had confronted Bosch with evidence of the wrongdoing but Bosch…

  • refused to return the alleged misappropriated (digital motor) technology, i.e., intellectual property, and
  • failed to promise it would not to use the acquired know how or technology for its benefit, even though reports indicated Bosch had already benefitted.

These adverse responses from Bosch obviously left Dyson’s legal representatives – advisors with few reputation saving options, other than to take the legal action it did.

Is the term ‘mole’ an appropriate descriptor of insider threat today?   To be sure it is!  In the court filings, Dyson also alleged that Bosch paid this individual (aka the mole) through a separate (unincorporated) business that apparently had been created precisely for such purposes, which is, presumably to exploit – execute insider risks and threats, which it is further alleged, certain senior Bosch management were well aware.

Bosch disputed, or at least tried to mitigate some of the allegations, one of which pointed out that Dyson had employed this individual, i.e., the mole, with a preexisting consultancy agreement with Bosch Lawn and Garden Ltd. in relation to garden products, and not vacuum cleaners or hand dryers.  Too, Bosch, expressed regret that Dyson had elected pursue legal action in this matter, saying it has been trying to establish what happened and what, if any, confidential information was supposedly passed and/or actually received.

Should Dyson’s allegations eventually be established (proven), it would be no great surprise to see some manner of economic settlement in advance of a trial.

Before finishing though, I hold a somewhat different view about what Dyson’s competitor was likely (actually) targeting in this instance, and it should not be simply described as intellectual property!.

As stated numerous times in this blog, I have worked, studied, and conducted much research on intangible assets relative to economic/industrial espionage in many different circumstances over the past 25+ years.  A deep understanding (business appreciation) of global economic – competitive advantage adversaries, suggests any insider threat – risk equation should absolutely include an adversary’s ability to understand and/or replicate the intangible assets they frequently target and successfully acquire, i.e., the intellectual and structural capital and know how that’s embedded in any alleged misappropriated or stolen intellectual property.

After all, it is an economic fact – business reality that intangible assets today, comprise 65+% of most company’s value, sources of revenue, and building blocks for growth, sustainability, and profitability. It seems quite correct then to state with much conviction, that the intangible assets which are absolutely essential to achieving competitive advantages, building product/service quality, creating efficiencies, and achieving market position are what’s being targeted, not merely IP, other than, of course trade secrets.

There’s no question, companies – competitors engaged in using stolen intangibles, do so because they have, in most instances, an equally strong desire to compete globally and in the same market space as the rightful holder, owner, and/or developer of the valuable and competitive advantage driving intangible assets being targeted.

Know how (intellectual capital) can, to be sure, be classified as proprietary information or trade secrets (providing the holder consistently executes and meets the six requisites of trade secrecy). Either way, I can confidently report that companies would be well served if they identified and safeguarded the contributory value of the intangible assets that underlie all of their IP, because that’s what the adversaries need, want, and seek most!

So, to effectively mitigate insider risks-threats, the contributory value of intangible assets companies produce, should become a routinely visited, if not a permanent fixture on every company’s c-suite agenda!

Comments regarding my blog posts are encouraged and respected. Should any reader elect to utilize all or a portion of this post, attribution is expected and always appreciated. While visiting my blog readers are encouraged to browse other topics (posts) which may be relevant to their circumstance. And, I always welcome your inquiry at 314-440-3593 or [email protected]



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