Taiwan charges 14 over Chinese theft of technological secrets

Taiwan is accusing Apple’s Chinese supplier of stealing commercial secrets from a Taiwanese company and poaching its workforce in order to win contracts from Apple.

Taiwan charges 14 over Chinese theft of technological secrets
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Taiwanese prosecutors said on Friday that they have charged 14 people in connection with their efforts to step up law enforcement against what they call illegal and underhanded activities by Chinese companies.

Reuters reported:

Prosecutors in New Taipei said after a year-and-a-half investigation they had found that China's Luxshare Precision Industry Co Ltd (002475.SZ) had targeted Taiwanese competitor Catcher Technology Co Ltd (2474.TW) “in order to quickly enter the Apple production chain to win orders”.

Luxshare “lured” Catcher's China based research and development team with promises of high salaries and stole business secrets from the Taiwanese firm, causing them big losses, the prosecutors said in a statement.

Luxshare was doing this in order to be able to “quickly build factories and mass produce cases for iPhones, iPads and other products”, the statement said. 

“The department will do its best to investigate such cases to maintain the sound development of our country's enterprises and ensure the competitiveness of national industries,” said the prosecutors in a statement.

In recent years, the Chinese have made a habit of hiring American engineers and scientists to steal state secrets from U.S government projects, and other illegal activities.

In January, a Chinese national named Xiang Haitao pleaded guilty to the theft of agri-tech from Monsanto, including an algorithm called the Nutrient Optimizer, which U.S. prosecutors called a “valuable trade secret” of the company’s. The information was stolen for the purpose of benefitting the People’s Republic of China, the Department of Justice said.

Also in January, University of Arkansas Professor Simon Ang pleaded guilty to lying to federal agents about patents in China.

The Justice Department stated:

The University of Arkansas, where Ang worked as a professor, required individuals such as Ang to promptly furnish to the University “full and complete” disclosures of inventions, and University policy provided that it, not individual inventors, would own all inventions created by those subject to the policy. This policy was established “in furtherance of the commitment of the University to the widest possible distribution of the benefits of University Research, the protection of Inventions resulting from such research, and the development of Inventions for the public good.”

Despite this requirement, Ang did not disclose his Chinese patents to the university and, when interviewed by an FBI agent, lied about his involvement in the inventions. Specifically, when asked whether his name would be listed as “the inventor” of numerous patents in China, Ang denied being the inventor, despite knowing he was. In addition, Ang also received numerous talent awards from the PRC government, which he did not list on the university’s annual conflict of interest disclosure forms.

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