Plea Bargain for Theft of Cisco Secrets
The man charged with taking intellectual property from Cisco Systems Inc. (Nasdaq: CSCO), his former employer, fessed up last week.
Peter Morch, a former R&D team leader at Cisco, pleaded guilty to federal charges that he downloaded proprietary optical networking product information from Cisco’s computers and later copied that information onto a laptop at Calix Networks.
When Light Reading first reported the charges against Morch, it was then discovered that Calix, a startup in Petaluma, Calif., is led by a number of former Cerent Corp. employees, including CEO Mike Hatfield. Board members include former Cerent executives Ajaib Bhadare and Cisco’s Carl Russo (see Theft Case Shines a Light on Calix ). Calix dismissed Morch in January 2001.
Morch was arrested in November after an FBI search of his home uncovered some CD-ROMs with proprietary software code and information about projects he'd worked on at Cisco. At that time, several documents containing Cisco project information were found on a laptop issued to Morch by Calix, his new employer.
In the FBI's affidavit, Morch told agents that he'd downloaded proprietary software from Cisco to use "as a reference" for his new job with Calix. According to the U.S. attorney's office in San Francisco, the maximum penalty Morch would have faced for trade secret theft, if convicted, was 10 years imprisonment and a fine of $250,000 plus restitution.
Thanks to a plea agreement, Morch will avoid the maximum sentence, since he admitted to lesser charges of taking confidential information, according to an Associated Press report.
Morch will receive three years probation and pay no fine. His sentencing is scheduled for June 27.
-- Phil Harvey, senior editor, Light Reading http://www.lightreading.com