A US court has ruled that an American pharmaceutical company stole trade secrets from the Northern Ireland pharmaceutical group, Norbrook Laboratories.

GC Hanford Manufacturing, a veterinary penicillin company of Syracuse, New York, competed unfairly with the Northern Ireland firm owned by former senator Dr Edward Haughey, according to the New York Federal Court.

It said Hanford had worked with scientist Dr Philip Quinn, of Newry, in a way that was "perhaps more sophisticated than outright trickery, trespass or piracy in that it secured the services of a third party no longer associated with" Newry-based Norbrook.

In his ruling Senior District Judge Howard G Munson outlined how Dr Quinn had worked for Norbrook and helped it devise a system for producing an injectable veterinary penicillin that allowed Norbrook undercut Hanford's price and capture the US market.

Despite having signed a confidentiality agreement, Dr Quinn, according to the ruling, subsequent to his having left Norbrook, acted as a consultant to Hanford and helped it develop a similar process for its product. Key parts of the work for Hanford were conducted in an Irish laboratory. Dr Quinn signed a confidentiality agreement with Hanford.

The court heard that Dr Quinn received payments of at least $20,000 from Hanford.

A preliminary restriction on Hanford producing a new product to compete against Norbrook was issued by the district justice. The Newry company has said it intends to continue prosecuting the US action vigorously.