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Safeguarding Your Company Against Insider Theft: 6 PRC Citizens Charged with Economic Espionage

Authors: Mark A. Klapow, Harvey Rishikof, and Edward Goetz.

On May 16, Hao Zhang, a Chinese university professor, was arrested upon entering the U.S. as one of six defendants charged with participating in a conspiracy to steal trade secrets and commit economic espionage against the United States. Their alleged goal was to set up a factory in the People’s Republic of China (PRC) that would develop and manufacture a series of high technology products that would have both civilian and military applications.

The 32-count indictment alleges that, with the financial support of the PRC and the PRC’s Tianjin University, in eastern China, the six conspirators established a shell corporation in the Cayman Islands, Novana, and a plant that could produce products from the information stolen from the US entities. The conspirators had filed for patents in both the US and PRC.

The two American companies at the center of their scheme were Avago Technologies (Avago), a California-based company, and Skyworks Solutions, Inc., based in Massachuetts. Avago is a leading designer, developer and supplier of a range of analog, digital and mixed signal products used in, e.g., cellular phones and tablets. The intellectual property allegedly stolen from Avago involved its patented Film Bulk Acoustic Resonators, known as FBAR. Continue reading this post on Crowell & Moring's trade secrets blog, CrowellTradeSecretsTrends.com.
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Mark A. Klapow
Partner – Washington, D.C.
Phone: +1 202.624.2975
Email: mklapow@crowell.com

Edward Goetz
Manager, International Trade Services – Washington, D.C.
Phone: +1 202.508.8968
Email: egoetz@crowell.com