Criminal Trade Secrets

Chinese and Russian Hackers Targeting COVID-19 Vaccine Research

The latest development in the Department of Justice’s “China Initiative” occurred earlier this month, as the DOJ unsealed an 11-count indictment charging two Chinese nationals with stealing hundreds of millions of dollars’ worth of “trade secrets, intellectual property, and other valuable business information”— including potential COVID-19 research.  The two Chinese hackers allegedly worked for their own benefit and together with the Ministry of State Security, China’s intelligence and security agency, to infiltrate the electronic networks of a number of targets including several American biotech firms “publicly known for work on COVID-19 vaccines, treatments, and testing technology.” READ MORE

In Pursuit of Chinese Trade Secret Theft: Fresh Allegations Against Huawei and Chinese Military Grabs 145 Million SSNs

Loyal readers are familiar with the DOJ’s “China Initiative,” launched in November 2018 to prosecute the theft of U.S. trade secrets by or for Chinese interests. Attorney General Barr reaffirmed the DOJ’s commitment “to combat the threat posed by theft directed and encouraged by the PRC” in an address at the China Initiative Conference last month. The DOJ’s campaign recently intensified with two new, gripping indictments. READ MORE

In a Blockbuster Economic Espionage Act Prosecution, an Attempt by the Government to Hide the Ball?

An ongoing, headline-grabbing trade secret theft prosecution against a Chinese spy is also quietly presenting a, say, disquieting attempt by prosecutors to stretch the law on what it is required to plead and prove.  On the civil side, when a plaintiff sues for trade secret theft, there’s almost always a hotly contested point of proof on whether the alleged stolen material is really a trade secret.  It’s well-established, though, that when the government charges a defendant criminally with the inchoate forms of trade secret theft—attempt or conspiracy being the two spelled out under the Economic Espionage Act—the government has no burden to prove that the underlying information was actually a trade secret.  (Loyal readers will recall our recent post on United States v. O’Rourke, where the defendant tried to argue otherwise at sentencing.)  Now, in a brief filed just last week, the government seems to be taking this one step further and arguing that it has no duty even to identify the trade secrets at issue. READ MORE

RICO Killer: DTSA Non-Retroactivity Wipes Out Racketeering Claim Based on Trade Secret Theft

On May 11, 2016, the U.S. Defend Trade Secrets Act (DTSA) created a federal remedy for trade secret misappropriation and added trade secret theft as an act that can form a predicate for Racketeering Influenced and Corrupt Organizations Act (RICO) violations.  Since the DTSA’s enactment, a number of courts have held that the DTSA does not apply retroactively to misappropriation occurring prior to enactment unless there is continuing use (i.e., an act constituting misappropriation after the DTSA’s enactment despite the acquisition occurring pre-enactment).  Recently, a court in the Northern District of California found the same to be true for RICO claims predicated upon misappropriation occurring prior to the DTSA’s enactment.  In Eli Attia v. Google, the court dismissed with prejudice plaintiff’s fifth amended complaint alleging RICO violations based on criminal trade secret theft and misappropriation that occurred in 2011 and 2012. READ MORE