The case unsealed today is representative of the Chinese
government’s trade secret theft that we see across the country and across
industries. Whether by co-opting
employees, by computer intrusions or by a combination of both, agents of the
Chinese government are systematically stealing our nation’s intellectual
property for the benefit of their own companies and their own country’s
strategic priorities. To counter this
activity, the Attorney General has launched a nationwide initiative, and I am
honored to lead it.
To glimpse the scope of the problem, just look at the recent
cases that we’ve charged. In the case we
unsealed today, the defendants are alleged to have misappropriated the
intellectual property of an American company and gone to a different company to
use this privileged knowledge unlawfully, to clone a product to compete with
the American product.
All after the Chinese Central Government and the State
Council publicly identified the development of that stolen technology as a
national priority and funded a company to mass produce the cloned
products. Then to add insult to injury,
the company that stole and is working to clone the legitimate American product
turned around and sued the American company for violating its patents
rights---which were built on the stolen technology.
In addition to the criminal charges, today, for the first
time ever, we also bring a civil action to stop the export of the illegal goods
and prevent the Chinese company from competing with the American product in
America. And we commend the action by
the Commerce Department to place the company on the Entity List, which means it
won’t be able to get the tools it needs to produce this product. As this case shows, we will continue to use
all available legal tools to protect American workers and American companies
from illegal activity.
Just two days ago, in United States v. Zhang Zhang-Gui, et
al., we charged ten defendants, including co-opted company insiders, working
for or acting on behalf of the Jiangsu Ministry of State Security, also known
as the “JSSD,” an arm of the Chinese intelligence services. According to the charging documents from the
Southern District of California, the defendants conspired to hack U.S. and
European defense and aerospace contractors in order to steal information to
develop a Chinese version of a commercial airplane turbofan engine.
Just over three weeks ago, in the Southern District of Ohio,
we obtained the extradition of a JSSD intelligence officer who was also alleged
to have attempted to co-opt an employee of a defense contractor in order to
steal trade secrets related to commercial airplane engines.
In September, in the Northern District of Illinois, we
charged an individual here in the United States who acted as a source for a
JSSD intelligence officer, helping him, among other things, to assess engineers
and scientists for recruitment.
In August, in the Northern District of New York, we charged
an individual with stealing turbine technology and sending it to China.
And so it goes.
Taken together, these cases, and many others like them,
paint a grim picture of a country bent on stealing its way up the ladder of
economic development—and doing so at American expense. This behavior is illegal. It’s wrong.
It’s a threat to our national security.
And it must stop.
The National Security Division has a variety of tools
available to deal with this problem.
First, as we’ve talked about, we can bring prosecutions. These prosecutions have raised the stakes for
intelligence officers and their alleged co-optees here in the United
States. If you work at an American
company and you help the Chinese steal its trade secrets, we will find you and
prosecute you.
These charges, in all their specificity, also prevent China
from hiding behind their long practiced, ritualized denials and feigned
ignorance.
These charges also serve to educate the American public and
alert U.S. business to what the Chinese government is doing on all fronts,
including their efforts to target commercial technology pursuant to insiders,
computer intrusions, and computer intrusions enabled by insiders.
And most important, through the criminal charges, a civil
suit for an injunction, an entity listing and other economic tools, the U.S.
government is making a coordinated, concerted effort to deprive the thief of
the benefit of his crime.
In addition, when the Chinese use their financial clout to
buy or make strategic investments to gain access to American technology and
personal data, the National Security Division will work with our partners on
the Committee on Foreign Investment in the United States to protect our
sensitive technologies and data from national security risk.
And when Chinese activity turns to the malign influence of
American politics in order to further its economic and political agenda, we
will use the Foreign Agents Registration Act and related criminal and civil
tools to ensure full transparency.
China wants the fruits of America’s brainpower to harvest
the seeds of its desired economic dominance.
Preventing this from happening will take all of us, here at the Justice
Department, across the U.S. government, and within the private sector. With the Attorney General’s initiative, we
will confront China’s malign behaviors and encourage them to conduct themselves
as the leading nation they aspire to be.
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