FBI Director Warns of Continued Chinese Threat to U.S. Companies’ Trade Secrets – Noting Over 1,000 Active FBI Investigations Into China’s Theft of U.S. Technology

On February 6, 2020, Christopher Wray, Director of the FBI, gave a speech titled “Responding Effectively to the Chinese Economic Espionage Threat,” in which Wray warned that “China is acquiring American intellectual property and innovation, by any means necessary.” Wray explained that:

• China presents a “diverse and multi-layered” threat to U.S. intellectual property, including “everything from cyber intrusions to corrupting trusted insiders,” impacting diverse targets “from Fortune 100 companies to Silicon Valley start-ups, and from government and academia to high tech and agriculture.”
• Currently, there are more than 1,000 FBI investigations pending involving China’s attempted theft of U.S.-based technology.
• The Chinese government “often requires [U.S.] businesses to put their trade secrets and their customers’ personal data at risk as the cost of gaining access to China’s huge market.”
• The FBI has many tools ranging from “criminal charges and civil injunctions to things like economic sanctions, entity listings, and visa revocations” to help protect and investigate theft of trade secrets owned by U.S. companies.
• The FBI cautions companies to consider who they choose to do business with, contract with, enter into joint ventures with, or allow to be part of their supply chains explaining that such relationships could have short term gains but in the long term cause companies to “find themselves bleeding intellectual property or hemorrhaging their most sensitive data.”
• It is important that the government-private sector work together to combat the threat of trade secret theft, and the DOJ and FBI are proactively working to educate the private sector and academia on trade secret theft and form beneficial relationships with those entities.

Consistent with the China Initiative DOJ announced in 2018, Wray explained that “[t]he Department of Justice and the FBI are going to hold people accountable for that and protect our nation’s innovation and ideas.” This statement reflects the DOJ’s continued focus on bringing criminal actions against both companies and individuals who engage in theft of US technology.

TIP: A company should be aware of the investigative tools available to law enforcement to assist a company with protecting its trade secrets, and should consider reaching out to law enforcement as part of the company’s trade secret protection strategy.