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American chip engineers accused of theft in a Chinese company

Four former engineers from Applied Materials Inc. were accused by the United States of trying to steal chip designs from the semiconductor equipment giant to sell them to a Chinese startup, which may feed fears that the The world's second largest economy resorts to illegal tactics to break its dependence on chip imports.

Liang Chen, Donald Olgado, Wei-Yung Hsu and Robert Ewald are accused of downloading data from Applied's internal engineering database, including more than 16,000 drawings, and plotting to attract investors to finance a US-based and Chinese-based startups that would compete with their previous employer, prosecutors said in a statement on Wednesday. The stolen specifications detailed Applied's processes for manufacturing large quantities of chips used to power and electrify flat-panel televisions and smartphones.

If convicted, the four face up to 10 years in federal prison for each of the 11 counts of stolen property. business secrets. They are scheduled to be processed on December 15 in San Jose, California.

"Applied Materials vigorously protects its intellectual property against theft or illegal use," company spokesman Ricky Gradwohl said in a statement. "We support the legal action in this criminal case to ensure that anyone who has obtained our business secrets is brought to justice." We can not comment more on pending legal actions. "

Contact information was not immediately available to attorneys at the four men.

Intellectual Property

Applied plays a critical role in the chip industry as the largest supplier of the machinery necessary to manufacture the vital components of electronics. Much of the experience and value of intellectual property that chip companies have stems from their mastery of the process technology that goes into the production of chips, something that becomes increasingly difficult as the limits are reached. of conventional materials such as silicon.

ina is the largest consumer of semiconductors as the final market and national companies fulfill very little of that demand. The government of the most populous country in the world is budgeting billions to build a local industry. Regulators have blocked attempts to acquire US chip companies by entities related to China.

There are no Chinese companies in the list of the best semiconductor manufacturers in the world. While plants are increasingly located in China, they are owned by companies in other countries. Chinese imports of chips have periodically exceeded the value of their oil expenditures, according to research by Sanford C. Bernstein & Co.

The criminal scheme is linked to the complex process of growing crystalline layers in chips called deposition of Organic chemical vapor from metal, technology developed by Applied after "years of research and testing, and millions of dollars in investment," according to the indictment. Applied's "Paragon" project led to the development of a consumer product called NLighten, which the engineers allegedly tried to replicate and build.

Competitor Company

At some point while working together on Applied from July 2000 to December 2012, the four employees conspired to steal MOCVD technology and use it to create a competing company called Envision, prosecutors said. Using their personal email accounts to detail the plans, they allegedly instructed lower-level employees to help them download confidential material, then stored it in a Google Drive account, while physically removing the MOCVD technology from the Applied offices in Santa Clara, California.

At the end of 2012, they tried to recruit investors to finance Envision in both the United States and China, according to the indictment. Prosecutors cite an email in which Olgado shared with his fellow conspirators the need to keep his project "secret", especially among potential investors who had independently identified the source of their technology.

The accusation documents do not detail the value of the theft or the amount that the engineers sought in the financing.

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