Pepsi China accused of stealing phone-call records

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Last updated at: (Beijing Time) Thursday, September 25, 2003

Pepsi China accused of stealing phone-call records

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Pepsi Co. Investment (China) Ltd. was accused by its partner Sichuan Yunlu in southwest China for violating commerce secrets by intending to steal the mobile phone records of Hu Fengxian, board chairman of Sichuan Yunlu.

The Intermediate People's Court of Chengdu City started hearing the case submitted by Sichuan Yunlu Wednesday.

The incident occurred on March 29 in 2002, when local telecom departments were visited by a man asking for the mobile calling records of Hu Fengxian, who is also general manager of Sichuan Pepsi, a joint venture by Pepsi Co. Investment (China) Ltd. and Sichuan Yunlu.

The man claimed he was an employee with the financial department of Sichuan Pepsi and needed to see the account records urgently.

The telecom department informed Hu Fengxian, who immediately called the police, suspecting blackmail. After investigation, the police found the man was Zhang Wei, sales manager of the west section subordinate plant of Pepsi Co. Investment (China) Ltd.

Zhang allegedly admitted he intended to steal Hu Fengxian's call records.

When spoken to by police, Zhang allegedly tried to bully the police with remarks such as "our company is a multinational" and "Kissinger is our consultant". But when he talked on the phone with his "lawyer" over 20 times, Zhang said he tried to steal the calling records out of curiosity as a private act that had nothing to do with Pepsi Co. Investment (China) Ltd.

However, judicial evidence proved the "lawyer" was a senior managing employee with Pepsi Co. Investment (China) Ltd..

After the incident, Hu said he had to change mobile phones frequently to escape leakage of commercial secrets and some of thecompany's partners canceled connection with Sichuan Yunlu for fearof being bugged.

Pepsi Co. Investment (China) Ltd. denied any involvement. A spokesman with the company described the incident to the media as "a low-level employee wanted to obtain calling records with the help of a friend", and "he has apologized after the police's investigation and has learnt a lesson".

According to international conventions, employees violating other people's privacy or commercial secrets will be punished severely, however Zhang Wei was promoted soon after the incident, from the sales manger of a subordinate plant of Pepsi Co. Investment (China) Ltd. to the sales supervisor with another jointventure of Pepsi.

Sichuan Yunlu believed this to be a company act and listed Zhang Wei as the No. 1 defendant and Pepsi Co. Investment (China) Ltd. as the No. 2 defendant.

The two sides had been in a delicate situation before the incident occurred, according to an anonymous ex-employee who held a senior position at Pepsi. To settle disputes with Sichuan Yunlu, Pepsi paid much attention to the activities of its managers, especially Hu Fengxian.

The plaintiff explained that to reduce the negative effects to the image of Pepsi and the career of Zhang Wei, Sichuan Yunlu tried through various channels to seek a proper solution with Pepsi Co. Investment (China) Ltd., but without success.

The situation had not been developing in a favorable direction and to protect the legal rights of the enterprise, Sichuan Yunlu filed a lawsuit against Zhang Wei and Pepsi Co. Investment (China)Ltd., demanding 10,000 yuan (about 1,204.81 US dollars) and a public apology in local papers.

Lawyers with the three sides argued vehemently in court.

Phone calls by Xinhua to Yang Meihong, a media officer with Pepsi Co. Investment (China) Ltd., were not immediately answered.

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