Ex-JHL Execs Sentenced For Wire Fraud and Trade Secret Theft

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Two former executives of JHL Biotech were sentenced to a year and one day each in prison after being found guilty of conspiracy and fraud.

The U.S. Attorney's Office of the Northern District of California sentenced Racho Jordanov, the co-founder and ex-chief executive officer of JHL Biotech, and Rose Lin, another co-founder and ex-chief operating officer, for engaging in wire fraud and conspiring to steal trade secrets. Both had already pleaded guilty to the charges on August 24, 2021.

Back then, Jordanov and Lin, also known as Rose Sweihorn, admitted to obtaining confidential, proprietary and trade secret information from Genentech and then used these to reduce expenses and hasten the timeline of JHL Biotech's own development and production efforts for Genentech biosimilar products. 

Through different means, Jordanov reportedly used many proprietary and confidential data without authorization to lift JHL's activities, including instructing others to use trade secret Genentech documents to create and operate new JHL facilities, such as its manufacturing plant in Wuhan, China. 

According to the plea agreement, he also hired ex-Genentech employees to work at JHL, who had brought with them, without authorization, some confidential documents. The list of breaches and fraudulent acts is long, all pointing to the former CEO knowingly engaging in illegal activity from 2011 to 2019. 

Lin, meanwhile, is said to have commissioned Xanthe Lam, a principal scientist who was then a full-time employee of Genentech, in 2014 to secretly work as JHL Biotech's head of formulation. She allegedly asked JHL scientists to consult with Lam whenever they met a roadblock in their research. Both Lin and Lam are said to have knowingly operated with intent to hide their activity from Genentech, and Lam's consultancy fee was even paid through her husband, Allen Lam.

On June 1, 2021, the federal grand jury indicted Lin and Jordanov with conspiracy to commit theft of trade secrets and wire fraud, international money laundering, conspiracy to obstruct justice and making false statements. Both Lin and Jordanov pleaded guilty to count one of the indictments, conspiracy to commit theft of trade secrets and wire fraud. The other charges were dismissed when the sentence was announced. 

In the sentence handed down on March 15, 2022, by Senior U.S. District Judge William Alsup, Jordanov faces 12 months and one day in jail, to be followed by 36 months of supervised release, with nine months in home confinement. Lin also faces 12 months and one day in prison, followed by a 36-month supervised release period. Xanthe Lam and Allen Lam also pleaded guilty to charges against them on July 7, 2021. 

The prosecution is the result of the investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigations unit. 

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