INDUSTRIAL THEFT CASE CRACKED HERE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00552R000100260032-9
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: July 21, 2010
• Sequence Number: 32
• Publication Date: December 9, 1981
• Content Type: OPEN SOURCE

Sanitized Copy Approved for Release 2010/07/21 : CIA-RDP90-00552R000100260032-9
3y Christine J. Jindr$
A -North Royalton man was ar-
rested at his home yesterday
morning, culminating a four.
month investigation of suspected.
industrial espionage leading as far.
away as the Soviet Union,,
Donald R. Blalock, who also
u1se3 the name Bob Steele, was
routed out of bed at 7 a,m. at his
condominium, 9650 Cove Rd., by',
Cuyahoga County deputy sheriffs
serving arrest and search war-
rants on charges brought by a
Valley View equipment manufac- !
'Wring company, Blalock's former
employer.
At the same time, deputies were
searching a Moreland Hills home
owned by Blalock and a former
wife, and machinery companies
in North Royalton and Solon which
Blalock allegedly hired to manu-
facture parts, using stolen blue-
prints of engineering drawings.
The companies did not know the
prints were stolen, investigators
said.
Summit County deputies also
searched the Hudson home of
Blalock's partner, Lester Smith,
president of Western Reserve
Group, a company operating out
of a post office box number in
Hudson.
Blalock was charged with re-
ceiving stolen engineering draw-
CLEVELAND PLAIN DEALER
9 December 1981
.ings from C-E Cast Equipment,
7887 Hub Pkwy., on a complaint
signed by Edwin M. Kavanagh,
C-E vice president of replacement
parts,
Blalock was released last night
on $5,000 bond posted by his
Russian-born wife of two years,
Blalock reportedly worked for
C-E more than 20 years, including
four years as a company repre-
sentative in Russia in the city of
Naberezhnye Chelny in the foot-
hills of the Ural Mountains. Smith
also worked for C-E as a vice
president and general manager.
Smith left' the firm in 1979 and
Blalock in 1980, said Asst. County
Prosecutor Frank C. Gasper.
Gasper said C-E believes Bla-
lock may have sold copies of the
stolen blueprints to its Russian
customers because orders for re-
placement parts from Russia have
dropped significantly.
Gasper said charges are being
considered against Smith, whom
private investigators believe
masterminded a scheme to steal
the blueprints, use them to have
parts manufactured and then sell
the parts to former customers of
C-E at 10% below C-E's prices.
In all, investigators believe
Blalock had more than $500,000
worth of counterfeit parts manu-
factured and sold in the last
year..
' Gasper said ' C-E designs
manufacturing equipment for
companies around the world and
then manufactures replacement
parts as needed. '
Blalock, using the name Bob
Steele, went to several machinery
companies and ordered replace-
ment parts using plans which had
the company name, Centrum;
stamped on them, but which were
identical to C-E designs, Gasper
said.
Blalock ordered the parts in the
name of Western Reserve Group,
said Don Niam, an Akron private
investigator hired by C-E in Sep-
tember when the company real-1
ized it needed outside help in its
internal investigation.
Gasper said from information
seized yesterday, authorities be-
lieve several existing employes
of C-E may be involved in the
scheme.
Sanitized Copy Approved for Release 2010/07/21 : CIA-RDP90-00552R000100260032-9
STAT