Chinese businessman in Charlotte to plead guilty to stealing trade secrets

Xiwen Huang is accused of stealing trade secrets over the past decade
Xiwen Huang is accused of stealing trade secrets over the past decade Mecklenburg County Jail

A Chinese businessman living in Charlotte will plead guilty Friday to corporate espionage, which prosecutors say was part of a long-range scheme to steal technology and trade secrets for his homeland and his business ambitions.

Xiwen Huang, 55, will admit to one count of stealing trade secrets during a 10:30 a.m. hearing in federal court in Charlotte. The charge carries a maximum penalty of 10 years in prison.

Prosecutors and new court documents say the Charlotte resident “schemed and stole trade secrets” from the government and multiple U.S. companies over 16 years.

The thefts all occurred at places Huang worked, the government says: At a government research facility and from firms that developed technology for the military and private enterprises. According to documents filed Thursday, Huang motives were to help the Chinese government and to advance “his aspirations for forming and operating his own company in the People’s Republic of China.”

The thefts started in 2006 and continued until Huang was arrested in May.

“For years Xiwen Huang targeted U.S. companies intending to steal the intellectual property others had worked so diligently to develop,” said John Strong, who heads the FBI’s office in North Carolina. Those thefts, Strong said, “put our state’s economy and people’s jobs at risk.”

Huang’s attorney, Jake Sussman, says the governments portrait of Huang is misleading and incomplete.

“This is not a case of a foreign national coming to the United States, stealing intellectual property and then selling the material to a foreign government,” Sussman said. “Dr. Huang has been a loyal and productive American citizen for many years.”

According to documents, Huang is accused of:

▪ Stealing “a large amount of intellectual property” pertaining to fuel cells for military vehicles from the government research center. When he took a new job in 2008, Huang emailed himself “multiple confidential and proprietary documents” related to his government work.

▪ Taking some 500 documents from one U.S. company that included proprietary information for 30 products involving $65 million of research and development costs. As before, Huang emailed himself the trade secrets after accepting another job, this time in Charlotte.

▪ Stealing some 100 documents from the Charlotte company for products carrying R&D costs of $25 million. Prosecutors say the Charlotte company, which specializes in power plant catalyst technology, fired Huang in March 2014 after discovering the thefts. He returned to China, carrying all the pilfered trade secrets with him.

▪ Starting his own company in North Carolina in 2012 with the plan of using what he stole “to do business in China and elsewhere.”

Huang first came to the country in 1998 to earn a chemical engineering doctorate from Auburn University. His real objective, prosecutors say, was to accumulate knowledge and information to serve his homeland.

“My goal was to learn, digest, accumulate” trade secrets to aid China and his own company, Huang wrote last year. “... It is necessary and obligatory for our generation to fulfill our share of responsibility in contributing towards the societal progress of China.”

Acting U.S. Attorney Jill Rose said that in achieving his objectives, Huang “is going to federal prison.”

“We will do the same to other industry thieves in a continued effort to protect American intellectual property and maintain fairness in the marketplace,” she said.

Sussman, though, said that while Huang has taken full responsibility for his actions, several of the government’s allegations remain in dispute.

“We ask that people reserve judgment until this process finishes playing out,” he said.

Michael Gordon: 704-358-5095, @MikeGordonOBS