Two men at the centre of legal action over the alleged theft of trade secrets from Apple, should continue to be monitored, US prosecutors have argued in court.
The two former Apple employees, who are were born in China, could flee to their homeland before their trial it is feared.
Indeed, Apple told the hearing at the US District Court for the Northern District of California, that it had “deep concerns” that the pair will try to flee before their trials if their locations are not monitored.
In July 2018, Xiaolang Zhang was arrested by the FBI as he attempted to leave the United States, after allegedly stealing self-driving car secrets.
The feds arrested Zhang at the San Jose airport as he was about to board a flight for China.
Zhang had allegedly booked the last-minute flight to China after downloading the plan for a circuit board for a self-driving car. The suspect allegedly planned to move to Chinese autonomous vehicle start-up called Xiaopeng Motors.
Meanwhile another man, Jizhong Chen, allegedly stole more than 2,000 files from Apple containing “manuals, schematics, diagrams and photographs of computer screens showing pages in Apple’s secure databases” with intent to share them.
According to Reuters, Chen was arrested by the FBI in January at a train station on his way to San Francisco International Airport for a trip to China.
Each man was charged with one count of criminal trade secrets theft and pleaded not guilty. They are currently on bail and have been monitored since then.
But both Apple and US prosecutors told the court that the men should continue to be monitored, as they present a flight risk.
Yet Attorney Daniel Olmos, who represents the men, was quoted by Reuters as saying both men had family reasons to visit China and had shown no signs of violating their pre-trial conditions so far.
But this cut little ice with US authorities.
Assistant US Attorney Marissa Harris argued that if either man fled to China, it would be difficult if not impossible for federal officials to secure their extradition for a trial.
Harris read Apple’s statement to US District Judge Edward J. Davila in San Jose, California.
“Apple’s intellectual property is at the core of our innovation and growth,” the statement reportedly said. “The defendants’ continued participation in these proceedings is necessary to ensure a final determination of the facts, and we have deep concerns the defendants will not see this through if given the opportunity.
Harris also said that Zhang’s wife told federal agents that Zhang, who is a permanent US resident, attempted to flee to Canada when agents searched his home.
During that search, agents reportedly found a laptop at the bottom of a laundry hamper that they allege contained trade secrets about Ethernet technology from Zhang’s prior employer, chip supplier Marvell Technology Group Ltd, according to court documents.
Trial dates have not been scheduled, Reuters reported, but a hearing is scheduled for February.
The case (if true) highlights the problem the United States has had with Chinese firms over the past several decades, with multiple allegations of corporate espionage made by US companies.
Specifically, Zhang worked on Apple’s Compute Team, designing and testing circuit boards to analyse sensor data.
Zhang apparently had “broad access to secure and confidential internal databases” due to his position, which contained trade secrets and intellectual property for Apple’s autonomous driving project.
Zhang reportedly took family leave from Apple in April 2018 following the birth of his child, and during that time, he visited China.
Shortly after this, he allegedly told his supervisor at Apple he was leaving the company and moving to China to work for XMotors, a Chinese startup that also focuses on autonomous vehicle technology.
But it seems that Zhang’s supervisor at Apple felt that he had “been evasive” during the meeting, all of which prompted an investigation by Apple’s New Product Security Team. They examined Zhang’s historical network activity and began analysing his Apple devices, which were seized when he resigned.
Apple reportedly discovered that just prior to Zhang’s departure, his network activity had “increased exponentially” compared to the prior two years he had worked at Apple.
He had allegedly accessed content that included prototypes and prototype requirements, which the court documents specify as power requirements, low voltage requirements, battery system, and drivetrain suspension mounts.
A review of recorded footage at Apple indicated Zhang had visited the campus on the evening of Saturday, 28 April 2018, entering both Apple’s autonomous vehicle software and hardware labs, which coincided with data download times, and he left with a box of hardware.
Zhang in an interview with Apple’s security people, apparently admitted to taking both online data and hardware (a Linux server and circuit boards) from Apple during his paternity leave.
He also admitted to AirDropping sensitive content from his own device to his wife’s laptop.
Apple then relayed the evidence to the FBI. Zhang in late June 2018 was interviewed by the Feds, during which he apparently admitted to stealing the information, and he was later arrested attempting to leave to China on 7 July.
Zhang for his part faces up to 10 years in prison and a $250,000 (£189,000) fine if found guilty of stealing Apple’s trade secrets.
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