Huawei Corporate Entities Conspired to Steal Trade Secret
Technology and Offered Bonus to Workers who Stole Confidential Information from
Companies Around the World
A 10-count indictment unsealed today in the Western District
of Washington State charges Huawei Device Co., Ltd. and Huawei Device Co. USA
with theft of trade secrets conspiracy, attempted theft of trade secrets, seven
counts of wire fraud, and one count of obstruction of justice. The indictment, returned by a grand jury on
January 16, details Huawei’s efforts to steal trade secrets from Bellevue,
Washington based T-Mobile USA and then obstruct justice when T-Mobile
threatened to sue Huawei in U.S. District Court in Seattle. The alleged conduct described in the
indictment occurred from 2012 to 2014, and includes an internal Huawei
announcement that the company was offering bonuses to employees who succeeded
in stealing confidential information from other companies.
“Today we are announcing that we are bringing criminal
charges against telecommunications giant Huawei and its associates for nearly
two dozen alleged crimes” Acting Attorney General Matthew G. Whitaker
said. “As I told Chinese officials in
August, China must hold its citizens and Chinese companies accountable for
complying with the law. I’d like to
thank the many dedicated criminal investigators from several different federal
agencies who contributed to this investigation and the Department of Justice
attorneys who are moving the prosecution efforts forward. They are helping us
uphold the rule of law with integrity.”
“The charges unsealed today clearly allege that Huawei
intentionally conspired to steal the intellectual property of an American
company in an attempt to undermine the free and fair global marketplace,” said
FBI Director Wray. “To the detriment of American ingenuity, Huawei continually
disregarded the laws of the United States in the hopes of gaining an unfair
economic advantage. As the volume of these charges prove, the FBI will not
tolerate corrupt businesses that violate the laws that allow American companies
and the United States to thrive.”
“This indictment shines a bright light on Huawei’s flagrant
abuse of the law – especially its efforts to steal valuable intellectual
property from T-Mobile to gain unfair advantage in the global marketplace,”
said First Assistant U.S. Attorney Annette L. Hayes of the Western District of
Washington. “We look forward to
presenting the evidence of Huawei’s crimes in a court of law, and proving our
case beyond a reasonable doubt. Fair
competition and respect for the rule of law is essential to the functioning of
our international economic system.”
According to the indictment, in 2012 Huawei began a
concerted effort to steal information on a T-Mobile phone-testing robot dubbed
“Tappy.” In an effort to build their own
robot to test phones before they were shipped to T-Mobile and other wireless
carriers, Huawei engineers violated confidentiality and non-disclosure
agreements with T-Mobile by secretly taking photos of “Tappy,” taking
measurements of parts of the robot, and in one instance, stealing a piece of
the robot so that the Huawei engineers in China could try to replicate it. After T-Mobile discovered and interrupted
these criminal activities, and then threatened to sue, Huawei produced a report
falsely claiming that the theft was the work of rogue actors within the company
and not a concerted effort by Huawei corporate entities in the United States
and China. As emails obtained in the
course of the investigation reveal, the conspiracy to steal secrets from
T-Mobile was a company-wide effort involving many engineers and employees
within the two charged companies.
As part of its investigation, FBI obtained emails revealing
that in July 2013, Huawei offered bonuses to employees based on the value of
information they stole from other companies around the world, and provided to
Huawei via an encrypted email address.
Under the maximum sentencing provisions applicable to
corporate entities, Conspiracy and Attempt to Commit Trade Secret Theft are
punishable by a fine of up to $5,000,000 or three times the value of the stolen
trade secret, whichever is greater. Wire
Fraud and Obstruction of Justice are punishable by a fine of up to $500,000.
The charges contained in the indictment are only
allegations. A defendant is presumed
innocent unless and until proven guilty beyond a reasonable doubt in a court of
law. The maximum statutory sentence is
prescribed by Congress and is provided here for informational purposes. If convicted of any offense, the sentencing
of the defendants will be determined by the court based on the advisory Sentencing
Guidelines and other statutory factors.
The case is being investigated by the FBI. The case is being prosecuted by Assistant
U.S. Attorneys Todd Greenberg and Thomas Woods of the Western District of
Washington, with assistance from the Department of Justice’s National Security
Division’s Counterintelligence and Export Control Section.
U.S. Attorney Brian T. Moran has been recused from this
matter because of legal representations he undertook before he joined the
Department of Justice. Per direction
from ethics officials in the Department of Justice, First Assistant U.S.
Attorney Annette L. Hayes will act as U.S. Attorney with respect to this matter
pursuant to the authority conferred by 28 U.S.C. § 515.
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