An administrative assistant at Coca-Cola Co. and two other people were arrested and charged with stealing confidential Coke documents and a secret-product sample that they allegedly tried to sell to PepsiCo Inc. Pepsi tipped off Coke to the scheme, which was busted after an undercover agent paid off one of the defendants with $30,000 stuffed into a Girl Scout cookie box, according to a statement from the U.S. attorney's office in Atlanta. The suspects, who are charged with wire fraud and unlawfully stealing and selling Coke trade secrets, were arrested Wednesday and are expected to appear before a federal magistrate judge in Atlanta Thursday.

Prosecutors said the three people arrested had attempted to sell to Pepsi several documents and a sample of a product under development at Coke. An unidentified senior executive at Pepsi headquarters in Purchase, N.Y., received a letter in May in an official Coca-Cola envelope from a man identifying himself as "Dirk" and offering to sell confidential Coke information, Pepsi spokesman Mark Dollins said.

Mr. Dollins said Pepsi "immediately" turned the letter over to Coke, of Atlanta. "We only did what any responsible company would do," he said. "Competition must be tough, but must always be fair and legal." On May 24, Coke turned the letter over to the Federal Bureau of Investigation, which launched an undercover investigation.

The administrative assistant accused of involvement in the scheme, Joya Williams, 41 years old, of Norcross, Ga., worked for a senior manager at Coke, according to a Coke spokesman. Coke company-video surveillance detected her pulling documents out of several files and stuffing them into bags, along with one glass bottle with a white label that contained a product sample.

Prosecutors identified the other two suspects as Ibrahim Dimson, 30, of New York, and Edmund Duhaney, 43, of Decatur, Ga., an Atlanta suburb. The defendants couldn't be reached for comment.

In a memo to employees, Coke Chairman and Chief Executive Neville Isdell said the company is cooperating with authorities. "Sadly, today's arrests include an individual within our company," he 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."

Mr. Isdell said he has ordered a review of Coke's information-protection policies, procedures and practices to make sure the company is adequately defending its intellectual property.

Prosecutors said Mr. Dimson, posing as "Dirk," provided an undercover FBI agent with several documents and promised more "that only a handful of top execs at my company have seen. I can even provide actual products and packaging of certain products, that no eye has seen, outside of maybe 5 top execs," he wrote in a June 2 email to the FBI agent. He was to provide a host of documents to the FBI agent Wednesday in exchange for $1.5 million, prosecutors said.

A Coke spokesman said the stolen information didn't include the company's secret formula for Coca-Cola, which is locked in a bank vault in Atlanta. "The secret formula was not and is not at risk," said spokesman Ben Deutsch.

Source: Wall Street Journal, 07/06/06