The Mind-Bending Value of Trade Secrets
It all started in June 2007 when a tall, arresting, blonde woman walked into a small copy shop in Surrey, UK. She had with her a folder containing a document of some 780 pages in length. She asked the weary clerk behind the counter to copy the 780 pages and scan them on to two CDs, which she would pick up later in the week.
Nothing too out of the ordinary about the request, and certainly nothing that the clerk had not been asked to do before. Unfortunately for the mysterious blonde, the clerk was a Formula One fan and happened to notice that the documents he was scanning appeared to portray technical drawings, schematics, and financial data relating to Formula One cars. Enough information, as it turned out, to design a whole car from scratch.
What made it more remarkable, however, was that each of the drawings sported the distinctive Cavallino Rampante, or prancing horse, of the Ferrari stable. The thing is, though, the only car manufacturers in Surrey weren’t Ferrari, but one of their direct competitors on the F1 circuit, McLaren.
The clerk, though, was a Ferrari fan. He took it upon himself to do a quick online search for the name on the customer slip – Trudy Coughlan – and realized that she was the wife of Michael Coughlan, at that time chief design of McLaren, Ferrari’s enemy on the track. He then did a search on Ferrari’s website until he found the contact details for the company’s head of F1, Stefano Domenicali.
The clerk typed a short email to Mr Domenicali which set the wheels in motion for the biggest scandal in motor racing history. One in which the McLaren Formula 1 racing team was ordered to pay £100 million (more than $130 million at the time) to Ferrari in September 2007. There were 780 pages of information, all of it stolen by Ferrari’s Nigel Stepney and handed to Coughlan earlier that week; that means it cost McLaren more than $128,000 per page. And very nearly got Nigel Stepney sent to prison.
Just information on paper, yet extremely valuable and powerful.