ATLANTA – Three people have been arrested and charged with stealing confidential information about drink recipes from The Coca-Cola Co. (KO) and trying to sell it to rival PepsiCo Inc. (PEP) federal prosecutors said Wednesday.
The suspects include an executive administrative assistant at Atlanta-based Coke, Joya Williams, who is accused of rifling through corporate files and stuffing documents and a new Coca-Cola product into a personal bag.
Williams, 41, of Norcross, Ga., and 30-year-old Ibrahim Dimson of New York and 43-year-old Edmund Duhaney of Decatur, Ga., are charged with wire fraud and unlawfully stealing and selling Coke trade secrets, federal prosecutors said.
They are expected to appear before a federal magistrate judge on Thursday in Atlanta.
Pepsi spokesman Dave DeCecco said his company did what any responsible company would do in cooperating with Coke and the investigation.
"Competition can sometimes be fierce, but also must be fair and legal," DeCecco said. "We're pleased the authorities and the FBI have identified the people responsible for this."
Coke's chief executive, Neville Isdell, said in a memo to employees Wednesday that the company is cooperating with federal authorities.
"Sadly, today's arrests include an individual within our company," Isdell wrote. "While this breach of trust is difficult for all of us to accept, it underscores the responsibility we each have to be vigilant in protecting our trade secrets. Information is the lifeblood of the company."
He said Coke will review its information protection policies, procedures and practices to make sure it safeguards intellectual property.
According to prosecutors, on May 19, Purchase, N.Y.-based PepsiCo provided Coke with a copy of a letter mailed to PepsiCo in an official Coca-Cola business envelope. The letter, postmarked from the Bronx in New York, was from an individual identifying himself as "Dirk," who claimed to be employed at a high level with Coca-Cola and offered "very detailed and confidential information." "Dirk" was later identified as Dimson, the FBI says.
Coca-Cola immediately contacted the FBI and an undercover FBI investigation began.
Prosecutors say Williams was the source of the information Dimson offered to provided Pepsi. They say that "Dirk" provided an FBI undercover agent 14 pages of Coca-Cola documents marked classified and confidential. The company confirmed that the documents were valid and highly confidential and were considered trade secrets. Williams works for a senior Coke manager, though the company would not say Wednesday which one. The company also would not say if she has been fired.
Prosecutors say "Dirk" requested $10,000 for the documents.
Later "Dirk" produced other documents that Coca-Cola confirmed were valid trade secrets of Coca-Cola and highly confidential. He also agreed to be paid $75,000 for the purchase of a highly confidential product sample from a new Coca Cola project, prosecutors said.
Then on June 27, an undercover FBI agent offered to buy other trade secret items for $1.5 million from "Dirk." The same day a bank account was opened under the names of Duhaney and Dimson, and the address used on the account was that of Duhaney's Decatur residence, prosecutors said.
Video surveillance showed Williams at her desk at Coke headquarters going through multiple files looking for documents and stuffing them into bags. She also was observed holding a liquid container with a white label, which resembled the description of new Coca-Cola product sample before placing it into her personal bag, prosecutors say, adding that Coca-Cola later verified the sample was genuine and is in fact a product being developed by the company.
Dimson, Williams and Duhaney were arrested in Atlanta on Wednesday, the day the $1.5 million deal was to take place, prosecutors say.