Federal prosecutors charge Chinese nationals with trade secret theft

The Justice Department says that two of the six defendants are former employees of U.S. tech firms.
The Justice Department says that two of the six defendants are former employees of U.S. tech firms.

Over the weekend, federal agents arrested a Chinese professor who had just entered the United States via a flight to Los Angeles – one of six Chinese nationals charged with economic espionage and theft of trade secrets from U.S. tech firms.

On Tuesday, DOJ announced that it had unsealed a 32-count indictment [PDF] charging the six defendants for their part in a “long-running effort to obtain U.S. trade secrets for the benefit of universities and companies controlled by the PRC [People's Republic of China] government,” the release said.

Tianjin University Professor Hao Zhang, 36, who was arrested Saturday, was said to have met defendant Wei Pang, 35, in the early 2000s during their doctoral studies in electrical engineering at the University of Southern California (USC). Pang, who is also a Tianjin University professor, and Zhang earned their doctorate in 2005, DOJ said, and Pang went on to become a FBAR engineer at Avago Technologies in Colorado, while Zhang was employed in the same role at Skyworks Solutions Inc. in Massachusetts.

The two specifically studied Film Bulk Acoustic Resonator (FBAR) technology during their studies at USC, which is “primarily used in mobile devices like cellular telephones, tablets and GPS devices,” DOJ said.

“FBAR technology filters incoming and outgoing wireless signals so that a user only receives and transmits the specific communications intended by the user.  Apart from consumer applications, FBAR technology has numerous applications for a variety of military and defense communications technologies,” DOJ's release said.

With their insider access at U.S. technology firms, Zhang and Pang were suspected of soliciting Chinese universities and other entities to develop FBAR technology, between 2006 and 2007. Through their efforts, the two “established relationships with officials at Tianjin University," one of the oldest universities in the country, which eventually “agreed to support Pang, Zhang and others in establishing an FBAR fabrication facility in the PRC," DOJ alleged.

In 2009, the pair resigned from their jobs in the U.S., became full professors at Tianjin University, and started a joint venture with the school, ROFS Microsystem, a company that would facilitate the mass production of FBARs using stolen trade secrets from Avago and Skyworks, prosecutors alleged.

In the indictment, prosecutors accused six defendants, and others “known and unknown” to the grand jury, of conspiring to “copy, duplicate, sketch, draw, download, upload, alter, photocopy, replicate, transmit, deliver, send, communicate and convey trade secrets belonging to Avago and Skyworks,” that would benefit the Chinese government.

The indictment referenced screenshots that were taken of stolen data, which were allegedly shared via email between defendants. Court documents also list instances, dating back to March 16, 2010, when defendants Zhang and Pang allegedly submitted U.S. patent applications related to FBAR technologies, before going on to do the same in China.

The other four defendants named in the indictment are Jinping Chen, 41, a Tianjin University professor and ROFS Microsystems board member, charged with conspiracy to commit economic espionage and conspiracy to commit theft of trade secrets; Huisui Zhang, 34, who studied electrical engineering with Pang and Hao Zhang in the U.S.; and Zhao Gang, 39, general manager of ROFS Microsystems, who both face the aforementioned conspiracy charges. Chong Zhou, 26, a Tianjin University graduate student and design engineer at ROFS Microsystem, also faces the two conspiracy counts, along with economic espionage and theft of trade secrets, as do Hao Zhang and  Pang.

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