by Sarah J.F. Braley | February 24, 2010

On Monday, federal prosecutors applied to U.S. District Court for the Southern district of New York to intervene in the corporate espionage case brought by White Plains, N.Y.-based Starwood Hotels and Resorts Worldwide against Chicago-based Hilton Worldwide, citing an overlapping criminal investigation. The new filing states, "The parties in this case consent to the Government's application to intervene, and defendants Hilton, [Ross] Klein and [Amar] Lalvani consent to a limited stay of discovery for a duration of six months." Starwood, the documents noted, objected to the stay. Klein and Lalvani, former Starwood executives, went to work for Hilton in June 2008, allegedly taking confidential Starwood documents with them. The criminal investigation is looking into whether several statutes have been violated, including those covering conspiracy, fraud in connection with computers, theft of trade secrets and interstate transportation of stolen goods.