Former Nationwide Children’s Hospital researchers charged with stealing trade secrets

Nationwide Children's Hospital in Columbus (WBNS-10TV)
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COLUMBUS, Ohio — A husband and wife team — both of whom are former researchers at Nationwide Children’s Hospital — have been charged by federal prosecutors with stealing trade secrets from the hospital related to cell research.

Prosecutors alleged that Yu Zhou and Li Chen both abused their positions by stealing research, and without Nationwide Children’s Hospital knowledge. created companies and patents in an effort to profit off the work done at NCH.

Both Zhou and Chen pleaded not guilty to charges of conspiracy to commit theft, theft of trade secrets and wire fraud. The pair was arrested in July in San Diego.

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An indictment, unsealed Monday, alleges that Zhou who worked for NCH between 2007 and 2017 created companies that marketed products and services related to exosome isolation - while they were employed by NCH.

The indictment describes exosome as small membrane-bound sacs that are produced by human cells and carry derived components such as RNA, microRNA, and DNA.

“(They) play a key role in the research, identification and treatment of a range of conditions... “ including “necrotizing enterocolitis (a condition sometimes found in premature babies), liver fibrosis, liver cancer, etc.”

In order to be used in research they must first be separated.

The indictment alleges that NCH devoted years of work and its own money to researching exosomes, which led to the discovery of trade secrets.

The indictment alleges the pair stole the trade secrets and other confidential information from NCH.

Prosecutors allege that the two formed outside companies, filed patents in China and fostered business relationships with groups that have ties to the Chinese government.

When asked about the indictment that alleges the two were married and profited together from the conspiracy, Steve Nolder, an attorney for Chen, told reporters: “That is what is alleged.”

Nolder went on to say that Chen was arrested while returning from China while his client, Li Chen, was lured back to her San Diego apartment by FBI agents. When asked if he was alleging that Mr. Zhou was more responsible than hjs client, Chen, he said: “Those are the facts.”

10TV reached out to Nationwide Children’s Hospital and received this statement:

"When we discovered this incident, we alerted the FBI and have been actively collaborating with them. We are grateful for their expertise throughout this process. We are unable to provide any specific details about the case."

A federal judge ruled Monday that both Zhou and Chen were a flight risk because of the charges, their connections to China and ordered them to remain in federal custody. A trial date was set for Nov. 18.

An attorney for Zhou had a brief encounter with reporters leaving the federal courthouse but declined to answer questions.

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