29 September 2022Sarah Speight

US accuses ex-NASA affiliates of trade secrets theft

Employee of space research body accused of illegally sharing software with US-blacklisted Beijing university | Separate case in Texas sees NASA researcher imprisoned for lying about connections with China and receiving federal grants for space research.

An ex-employee of a NASA contractor has pleaded not guilty to trade secrets theft after being charged with smuggling sensitive aviation software to a university in Beijing, China.

Jonathan Yet Wing Soong, from San Jose, California, was a programme administrator for the Universities Space Research Association (USRA) between April 2016 and September 2020.

USRA is a non-profit organisation contracted by NASA to “distribute domestically and internationally sensitive aerospace related software developed through the Army Software Transfer Agreement (STA) programme,” according to the US Department of Justice (DoJ).

At USRA, Soong was responsible for overseeing certain software licence sales, conducting export compliance screening of customers, generating software licences, and physically exporting software.

The allegations against 34-year-old Soong were set out in a complaint filed and unsealed in May this year in the DoJ’s US Attorney’s Office, Northern District of California.

‘Unlawful’ export

According to the complaint, Soong “unlawfully and without a licence exported and facilitated the sale and transfer of software to a body on the so-called ‘entity list’—Beijing University of Aeronautics and Astronautics (BUAA), which is also known as Beihang University,” explained the DoJ.

The entity list and associated regulations prohibit the export without a licence of certain technology that has commercial and potential military applications, “to entities and individuals whose activities have been found to be contrary to US national security or foreign policy interests”.

Beihang University was added to the entity list because of its involvement in People’s Republic of China military rocket systems and unmanned air vehicle systems.

“Given its inclusion on the entity list, BUAA is prohibited from receiving certain items without a licence,” said the DoJ. “The complaint alleges Soong used an intermediary in hopes that the illegal transfer would not be detected.”

The software in question was marketed for the development of unmanned aircraft. The army flight-control software packages, referred to in the complaint as CIFER, enables users to develop a dynamic model of an aircraft based on collective flight test data. This can then be used to analyse and design aircraft control systems.

Soong is charged with violating International Emergency Economic Powers Act (IEEPA), in violation of several US laws.

The IEEPA violation carries a statutory maximum penalty of 20 years in prison and a $1 million fine, while the smuggling count could mean a maximum of 10 years in prison and a $250,000 fine.

Soong appeared before US Magistrate Judge Laurel Beeler on June 2, 2022, but pleaded not guilty in a hearing at the US District Court for the Northern District of California, San Francisco Division on Wednesday September 28.

Soong is represented by Hanni Fakhoury of San Francisco-based Moeel Lah Fakhoury law firm.

Concealed connections

In a separate case, a Texas professor has pleaded guilty for concealing connections with China while accepting federal grant money.

Zhengdong Cheng, a NASA researcher and former chemical engineering professor at Texas A&M University, pleaded guilty on two counts—violation of NASA regulations and falsifying official documents—last Thursday, September 22 in a Houston federal court.

The plea followed Cheng’s arrest in 2020 on charges of conspiracy, making false statements and wire fraud.

US authorities had accused Cheng, who conducted research for NASA while at Texas A&M, of hiding his connections to a Chinese government ‘talent programme’, which sought to use research from American institutions to advance military and other programs in China.

Cheng’s team received nearly $750,000 in US federal grants for space research, according to the complaint.

Cheng was sentenced to time already served during pre-trial imprisonment of approximately 13 months, and has agreed to pay $86,876 in restitution to NASA and a fine of $20,000.

His conviction was part of the China Initiative, a DoJ anti-espionage programme created under the Trump administration. But in February this year, the Justice Department abandoned the programme after complaints that it damaged academic collaboration and contributed to anti-Asian bias.

Texas A&M and the Texas A&M System (a state university system representing 11 universities and eight state agencies) worked with the FBI and other federal partners in an investigation leading to Cheng’s arrest in 2020. He was sacked by Texas A&M soon after.

John Sharp, chancellor of the Texas A&M System, said in a statement: “Texas A&M and the Texas A&M System take security very seriously, and we constantly are on the look-out for vulnerabilities, especially when national security is involved.

“We will continue to work with our federal partners to keep our intellectual property secure and out of the hands of foreign governments who seek to do us harm.”

In a tweet last Friday, September 23, the FBI’s special agent in charge in Houston, James Smith, commented on the FBI’s work with Texas A&M.

“The FBI prioritises investigating threats to academia as part of our commitment to preventing intellectual property theft at US research institutions and companies…,” he said.

“Dr Cheng’s conviction in this case demonstrates both the critical importance of the cutting-edge technology developed at Texas A&M University, and the university’s partnership with the FBI Bryan Resident Agency and NASA Office of Inspector General to protect it.”

Cheng’s attorney Philip Hilder said the professor was “relieved that this unfortunate chapter of his life is behind.”

WIPR launches ranking of top trade secrets firms

These developments in trade secrets litigation come as WIPR  Insights launches an industry-first ranking of top trade secrets firms.

Commenting on the launch, Baron Armah-Kwantreng, rankings editor, said: “Global brands and their IP practitioners are increasingly aware of the risks posed by their most valuable know-how, or 'secret sauce', exiting the building on a data stick with former employees.

"The WIPR Insights Global Trade Secrets rankings supplement will spotlight the global firms who can help clients navigate these risks.”

Would you like to be considered for inclusion in our Global Trade Secrets rankings?

Here's how to get involved.

For further information on the Global Trade Secrets special edition please contact:

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