Two Men Charged with Stealing Trade Secrets from Connecticut Defense Contractor

Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a grand jury in Bridgeport has returned a 29-count indictment charging JARED DYLAN SPARKS, 33, of Ardmore, Okla., and JAY WILLIAMS, 45, of Griswold, Conn., with offenses related to a scheme to steal trade secrets from a Connecticut-based defense contractor.  The indictment was returned on November 3.  SPARKS was arrested on November 7 and WILLIAMS was arrested on November 8.

According to court documents and statements made in court, SPARKS, an electrical engineer, and WILLIAMS, an electronic technician, both worked at LBI Inc., a Connecticut-based defense contractor that designs and builds, among other things, unmanned underwater vehicles for the U.S. Navy Office of Naval Research.  From January 4, 2010, until December 2, 2011, SPARKS was employed by LBI as the Lead Electrical Engineer for design, prototyping and testing for prototypes of unmanned vehicles.  From May 10, 2010, until November 23, 2011, Williams was employed by LBI as an Electro-Mechanical Technician tasked with the fabrication, installation, testing and operation of various prototypes of unmanned vehicles.

During the course of their employment with LBI, SPARKS and WILLIAMS collaborated with employees of Charles River Analytics, a Massachusetts-based software company that developed software to be integrated into LBI’s unmanned underwater vehicles.  In late 2010 and early 2011, Charles River Analytics sought to expand into the hardware business and eventually agreed with the Office of Naval Research that it would complete the testing for a number of the unmanned vehicles designed and developed by LBI.  However, Charles River Analytics had never done that work before and had no staff that could carry out that work.  Sometime after April 2011, SPARKS and WILLIAMS began exploring employment with Charles River Analytics, and were eventually hired by that company in the fall of 2011.

Information obtained from the execution of various search warrants revealed that beginning in at least May 2011 and continuing until November 2011, WILLIAMS and SPARKS, without authorization, uploaded LBI proprietary information to accounts in Dropbox, a cloud-based storage application.

SPARKS and WILLIAMS ended their employment with LBI in December 2, 2011, and November 23, 2011 respectively, and both began working with Charles River Analytics on January 3, 2012.  SPARKS and WILLIAMS continued to possess stolen trade secrets belonging to LBI after the end of their employment with LBI.  During the course of their employment at Charles River Analytics, they both continued to work on at least one of the unmanned underwater vehicles that LBI had designed and developed.

“Connecticut’s defense contractors are critical to our country’s national security,” said U.S. Attorney Daly.  “The U.S. Attorney’s Office is committed to working with our law enforcement partners to ensure that intellectual property is protected, and that those who profit from stealing trade secrets are prosecuted.”

“The need to protect the intellectual property of the U.S. Department of Defense contractors is now more important than ever,” said Craig W. Rupert, Special Agent in Charge, Defense Criminal Investigative Service (DCIS), Northeast Field Office.  “The theft of defense contractors’ trade secrets in particular, poses a grave threat to our national economic security and harms the Department of Defense’s investment in research and development.  DCIS remains committed to working with our federal law enforcement partners and the U.S. Department of Justice to ensuring those who actively steal our nation’s trade secrets are prosecuted.”

The indictment charges SPARKS and WILLIAMS with one count of conspiracy to steal, upload, transmit and possess stolen trade secrets, an offense that carries a maximum term of imprisonment of five years.  The indictment also charges SPARKS with seven counts of theft of trade secrets, seven counts of upload of trade secrets, two counts of transmission of trade secrets and five counts of possession of stolen trade secrets.  WILLIAMS is also charged with seven counts of possession of stolen trade secrets.  If convicted, the defendants face a maximum term of imprisonment of 10 years on each count.

U.S. Attorney Daly stressed that an indictment is not evidence of guilt.  Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

Both defendants are released on bond pending trial.

This matter is being investigated by the Defense Criminal Investigative Service and the Federal Bureau of Investigation.  The case is being prosecuted by Assistant U.S. Attorney Jacabed Rodriguez-Coss and Trial Attorney Brian Resler from the Computer Crimes and Intellectual Property Section of the U.S. Department of Justice, Criminal Division.