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Feds Bust Chinese Firm's Hybrid Car Data Heist 203

Posted by timothy from the pesky-agents-of-the-f-b-i dept.
coondoggie writes "An FBI investigation has led a Michigan couple to be charged with stealing hybrid car information from GM to use in a Chinese auto outfit. A federal indictment charged Yu Qin, aka Yu Chin, 49, and his wife, Shanshan Du, aka Shannon Du, 51, of Troy, Michigan with conspiracy to possess trade secrets without authorization, unauthorized possession of trade secrets, and wire fraud. One of the individuals was also charged with obstruction of justice, said Barbara McQuade, United States Attorney for the Eastern District of Michigan in a statement. GM estimates that the value of the stolen documents is over $40 million."
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Feds Bust Chinese Firm's Hybrid Car Data Heist More

Feds Bust Chinese Firm's Hybrid Car Data Heist

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  • Yu (Score:5, Funny)

    by Hatta ( 162192 ) on Thursday July 22, 2010 @05:04PM (#32996830) Journal

    Yu got served.

  • Oh noes (Score:3, Funny)

    by mark72005 ( 1233572 ) on Thursday July 22, 2010 @05:04PM (#32996834)
    Now theirs will crash just like ours!

    • Re: (Score:2, Interesting)

      by Monkeedude1212 ( 1560403 )

      What was the last Chinese Car Manufacturer that even penetrated the US market to damage the sales of US companies?

      I get that trade secrets are trade secrets, but documents worth $40 Million? To who? It's not like you would have lost $40 Million had they been delivered.

      • Re:Oh noes (Score:5, Insightful)

        by YrWrstNtmr ( 564987 ) on Thursday July 22, 2010 @05:14PM (#32996978)
        No, they would be busting the US (and other entities) of their segment of the Chinese and Asian markets.

        For instance, Buick is a huge brand [wikipedia.org] in China

        • Well, I was not aware of that. I wish I could retract my statement.

          • and now you understand why the government bailed out GM.

          • Re: (Score:2)

            by AK Marc ( 707885 )
            Buick is the best selling foreign make in China, but still less than 6% of the market, so I'd not even consider that a foothold. More like a toe in the water. The vast majority of Chinese vehicles are made in China. But I was surprised by the Buick presence as well, I saw more things like the Honda Fit running around as foreign makes.

        • Re:Oh noes (Score:5, Funny)

          by Hognoxious ( 631665 ) on Friday July 23, 2010 @05:52AM (#33001248) Homepage Journal

          For instance, Buick is a huge brand in China

          But for some strange reason, Chevloret, Rincorn and Chlysrel aren't.

      • Re: (Score:2)

        by Zocalo ( 252965 )

        It's not like you would have lost $40 Million had they been delivered.

        Maybe not, but Yu is probably going to lose at least 10 years.

      • Re: (Score:2, Insightful)

        by Anonymous Coward

        I assume that you are unaware of how important the Chinese market is for GM. Here is a recent article about it: China sales overtake U.S. for first time [suntimes.com]. Chinese car companies don't have to come over here, they can hurt GM at home.

        And $40 million dollars doesn't seem unreasonable. That's only about 2000 vehicles at average US prices.

      • Re: (Score:3, Informative)

        by MobyDisk ( 75490 ) *

        What was the last Chinese Car Manufacturer that even penetrated the US market to damage the sales of US companies?

        Consider the exact opposite situation: General Motors has a significant presence in China. These documents could damage General Motors operations in China. And that might be worth $40 million.

  • smog (Score:5, Funny)

    by spazdor ( 902907 ) on Thursday July 22, 2010 @05:06PM (#32996876)

    Way to go, FBI. We're already trying our best to fight the Chinese government's dragging their heels on environmental reform. Now we want them to do it without stealing any green technologies?

    • Re: (Score:2, Informative)

      by linzeal ( 197905 )
      They publish 6x the amount of research papers we do and spend 20% more on research. How come we aren't stealing from them?

    • Re: (Score:3, Interesting)

      by delinear ( 991444 )
      On a serious note, green technologies are one of the few things the West are doing better than the East right now. We can't sell them manufactured goods, they've already cornered that market, and they're at least as close if not edging ahead on banking and perhaps even IT. Anything that relies on IP is a non-starter. Do you didn't think western governments were suddenly supporting green technologies because it's the right thing to do, or because it's one of the few things we have of value right now (not to

  • Competitive advantage for the USA? (Score:5, Insightful)

    by Anonymous Coward on Thursday July 22, 2010 @05:07PM (#32996896)

    Umm, don't we want China to steal all the GM tech they possibly can, so they won't be competitive either?

    • You assume that it can't get worse than GM. Well, it can [youtube.com].

  • just think of it as "proactive outsourcing" (Score:5, Insightful)

    by Anonymous Coward on Thursday July 22, 2010 @05:09PM (#32996912)

    sooner or later this "secret" would have ended up at the chinese manufacturing plant.

  • Must have been for export (Score:3, Interesting)

    by MichaelSmith ( 789609 ) on Thursday July 22, 2010 @05:14PM (#32996982) Homepage Journal

    Hybrids are a bit of a joke, efficiency wise so I have my doubts about a domestic market for them in China. But Chinese car makers could compete with the Japanese, etc in the export market. But you'd expect that they would get found out. Maybe the immediate objective was to sell a complete system within china and let the buyer take the rap for the stolen tech.

    • Re:Must have been for export (Score:4, Insightful)

      by CaptainJeff ( 731782 ) on Thursday July 22, 2010 @05:18PM (#32997026)
      Bit of a joke? What exactly would that be?

      http://www.usatoday.com/money/autos/environment/2008-05-11-hybrids-gas-prices_N.htm

      I've owned a 2006 Civic Hybrid for the past four years and calculate the savings based on my driving habits and the cost of gas every year. It recouped its cost over a year ago and has currently saved me well over $1000. It also pollutes less. So...why is this a joke?

      • Re: (Score:2, Interesting)

        by Anonymous Coward

        Because if you look at the European market, you'll see a dozen models that get as good or better mileage than any hybrid available in the US.

        • Be careful. A Gallon in the US is 20% smaller than an imperial gallon, but a mile is the same distance. So to compare, either do the conversion or use metric. The European models are more efficient, but not by as big a margin as it might first appear.

      • Re:Must have been for export (Score:4, Interesting)

        by Skuld-Chan ( 302449 ) on Thursday July 22, 2010 @05:47PM (#32997358)

        Because it was a 30,000 dollar car, and I can but a ton of gas for 15,000 dollars.

        Also - my 04 Civic Coupe gets 45+ miles per gallon the freeway.

      • Re: (Score:3, Insightful)

        by h4rr4r ( 612664 )

        And what would the mileage be like in the same car with a small turbo diesel?

      • It's likely you'll wipe out any savings when you do.

      • Re:Must have been for export (Score:4, Interesting)

        by thePowerOfGrayskull ( 905905 ) <marc,paradise&gmail,com> on Thursday July 22, 2010 @07:24PM (#32998342) Homepage Journal

        Bit of a joke? What exactly would that be? http://www.usatoday.com/money/autos/environment/2008-05-11-hybrids-gas-prices_N.htm [usatoday.com] I've owned a 2006 Civic Hybrid for the past four years and calculate the savings based on my driving habits and the cost of gas every year. It recouped its cost over a year ago and has currently saved me well over $1000. It also pollutes less. So...why is this a joke?

        Except if you're calculating the savings based on cost of gas and driving habits alone, you're missing a major part of the equation. Did you include the $23000 it cost you to buy a new car, as opposed to continuing to maintain/repair and feed gas into your old one? Or if this was your very first car, did you do the calculations for getting a cheap used car vs new car, and take the price difference into account?

        If you absolutely had to get a new car, did you look a the 2006 Civic -- 10-12k cheaper than the Hybrid, with gas mileage that's not appreciably worse? Did you take into account that 10-12k price difference in your calculations?

        When you look at the miles you drive without taking into account the base cost, you're only seeing part of the picture needed to determine if you recouped your cost. And unless you drive a 40-50k miles a year, your costs have not been recouped. (I did a breakdown of the math in a comment some time back, and showed that it would take gas in the range of $8-9/gallon to recoup costs over a five year period at 12k a year; or $5-6/gallon to recoup them if you assumed you had to buy a new car and calculated based on price difference.)

        • Re: (Score:3, Interesting)

          by RzUpAnmsCwrds ( 262647 )

          Anyone who compares the cost of buying a new hybrid to keeping an older car is a moron.

          Guess what? It's almost ALWAYS cheaper to keep an old car that's serviceable. Gas is too cheap and cars are too expensive. That applies to hybrids and non-hybrids alike.

          People still buy new cars. There are a lot of reasons for that.

          Moreover, the same idiots never consider the fact that there are used hybrids. My 2007 Prius with 45000 miles on it cost $13500, which was only about $2000 more than a 2007 Corolla.

          Your figure

          • Of course, the GX is missing a lot of things that the Hybrid has standard - like an automatic transmission, [...] and power windows.

            Hell, I'd pay extra NOT to have either of those. Why do you think people are buying new cars every five years? Because the crappy power window motor goes out, and the cost of getting a mechanic to replace one is astronomical. If you're a bit mechanically inclined, you can replace them yourself with after-market parts, but it's certainly hard, time-consuming work. Meanwhile,

          • Guess what? It's almost ALWAYS cheaper to keep an old car that's serviceable. Gas is too cheap and cars are too expensive. That applies to hybrids and non-hybrids alike.

            Fair point. These really are too different issues.

            Price compared to hybrid: you're mostly right, the price range as 14,360 -$23,350; I misread. So it was 9k instead of 10k; that doesn't fundamentally change anything.

            When you make up your numbers, compare cars that aren't comparable, ignore the used hybrid market, or compare a used vehicle to a new hybrid, it's very easy to make hybrids look much more expensive than they are. It's also misleading and dishonest.

            You raise a valid point in that the comparisons weren't apples-to-apples. So let's look at some hard numbers by comparing two comparable models of 2006 Honda Civic, bought at Kelly Blue Book values and using current gas prices.

            For our base number, we'll assume 12000 miles a yaer. Your us

            • Ugh. "two" different issues... (though I guess technically "too different issues" is almost valid, if I'd included a hyphen... (here, let me me use more ellipses... (maybe it's time to go to sleep...)) )

      • Re: (Score:3, Interesting)

        by Idbar ( 1034346 )
        He probably meant the GM hybrids, such as the Yukon, Escalade, Silverado and Tahoe. Now, that's what I think is a joke. :)

      • So...why is this a joke?

        Because *real* cars do 10 mpg and weigh 3 tons.

      • Re: (Score:3, Insightful)

        by drinkypoo ( 153816 )

        Bit of a joke? What exactly would that be?

        The joke is that hybrids get no more mileage than TDIs, but have a higher initial energy cost of production, and a higher initial monetary cost, AND a higher recycling cost, while their fuel (gasoline) takes more energy to produce than diesel fuel. If non-plug-in gas hybrids are the answer then the question was fucking stupid. No matter how you slice it, a hybrid is NOT the most efficient solution readily available on the market today.

    • Re: (Score:3, Informative)

      by Anonymous Coward

      Hybrids are a bit of a joke, efficiency wise so I have my doubts about a domestic market for them in China.

      Hybrids are pretty damn impressively efficient if applied to a medium-small vehicle used mainly in city and near-by suburbs. The joke is when you try to apply the same concept to a huge SUV. Or when the majority of your driving is out of the cities. One size does not fit all.

      But you'd expect that they would get found out.

      How? I'll remind a lot of readers here that these "secrets" are not always a

      • Or when the majority of your driving is out of the cities.

        Actually, decent hybrids are quite good on the highway. My Prius, in the real world, gets 50MPG on the highway (I get about 45MPG around town).

        The advantage is less, true. Let's look at consumption, which is a better figure than MPG for comparisons because it's not an inverse scale.

        On the highway, my Prius requires 4.70 liters of gas to go 100km. A similarly-sized Toyota Corolla requires 6.92 liters to go the same 100km.
        In town, my Prius requires 5.2

        • Re: (Score:2)

          by AK Marc ( 707885 )
          A hybrid on the open road has similar performance and similar economy to a car with the same size gasoline engine. There's an ability to make the gasoline engine smaller because the electric motor boosts the "feel" of the acceleration. But if you compare a 1.5 l with a 1.5 l and one's hybrid and one's not, you won't see a difference in performance on the open road (assuming the same engine, the one in the Prius is tuned for economy over performance, and many 1.5 l engines will be more tuned for power than

  • Not Patents (Score:4, Insightful)

    by Doc Ruby ( 173196 ) on Thursday July 22, 2010 @05:28PM (#32997128) Homepage Journal

    This story is tagged "patents", but it's not about patents. The copied data was a trade secret. Patents are by definition publicly published information. Trade secrets are different. Patents are easily abusable government monopolies that often violate free speech. Actual industrial secrets are essential to remaining competitive, as this case demonstrates. It's cheaper, faster and less risky for a Chinese (or any other) corporation to copy the data that GM (or anyone else) produced over a period of time and at a significant cost, than it is for that competitor to produce its own. The secret was violated by violating agreements and other deception.

    • Re:Not Patents (Score:4, Informative)

      by nedlohs ( 1335013 ) on Thursday July 22, 2010 @06:00PM (#32997518)

      How do patents ever violate free speech?

      You can talk about them, copy them, repeat them, etc. You just can't do* what is described without permission from the patent holder.

      * the definition of "do" varies by jurisdiction.

      • Computer programming is a form of speech, which cannot be performed freely because patents prevent it (in countries where software is patentable).

        • A patent doesn't stop you writing and reading the code. It just stops you running it.

          So the speech part remains allowed.

          • Re: (Score:2)

            by AK Marc ( 707885 )
            A patent would make it illegal to write infringing code, even if never compiled, run, or shared.

            • Sure, if you live somewhere with shitty laws, but that's ypur fault.

            • Re: (Score:2)

              by sFurbo ( 1361249 )
              Would it? My understanding is that patents makes it illegal to use the technology in anything in the marketplace. My university has a bachelor-level course where they clean up a protein which is quite expensive because of a patent. They end up throwing away 1000's of dollars worth of it every year as they aren't allowed to sell it. As long as they don't sell it (or give it away, or...), they are allowed to follow the patent, though.

              If the situation is the same with software patents, you are allowed to writ

              • Re: (Score:2)

                by AK Marc ( 707885 )
                Patents include control of making the item. Perhaps there is a special license for them for educational use, or perhaps they think that "fair use" or some such applies to patents (it doesn't) or perhaps they think you aren't in violation unless you sell or distribute it. Regardless, they are violating the patent, even in an educational setting, to make a patented item (unless so licensed).

                http://www.law.cornell.edu/uscode/35/271.html

          • Re: (Score:3, Insightful)

            by k8to ( 9046 )

            If that were true, there would be no issues with distributing and selling patented software, only running it.

    • From what I see, this is what happened. They worked as engineers at GM and they were let go. Du then copied her work files and then started a company where they used the GM files to further their company. They probably rationalized that since they had worked on the project, they had a right to use it for their personal company.

      I've heard variants of this in a few places. There was a software company who let a few engineers go but they started a competitive business with the code they had worked on but did

  • Values (Score:3, Funny)

    by Wowsers ( 1151731 ) on Thursday July 22, 2010 @05:47PM (#32997350) Journal

    "GM estimates that the value of the stolen documents is over $40 million."

    Is that using the same method of value calculation that the RIAA / MPAA use?

    • No, it's the amount of the next bailout they were expecting to receive after implementing the plans outlined in those documents. ~

  • Why not just wait... (Score:4, Insightful)

    by GumphMaster ( 772693 ) on Thursday July 22, 2010 @06:41PM (#32997938)
    Risking jail time for a 'trade secret' (which seems to carry more weight than national secrets that might be protecting lives) seems to somewhat pointless. Why not just wait until GM implements whatever super-secret-mega-tech in a vehicle and then reverse engineer it? Once GM 'publish' it in this form without patent protection it seems to me it is fair game.

  • This is a real problem.. details below. (Score:4, Informative)

    by Anonymous Coward on Thursday July 22, 2010 @07:12PM (#32998226)

    You think the Russians had spies? They're nothing compared to the Chinese.

    This is not individual actors out for their own gain, this is a concerted effort over the last 30 years to get China on par with the latest tech, by hook or crook.

    While there's nothing wrong with that per-se, the thing that everyone seems to be ignoring is that China is not an open society and all this maneuvering is to get more Geopolitical Power for the Communist Party. A non-representative, totalitarian regime bent on imposing its will across the region and the world. People assume once China is "caught up" they'll follow international rules and "play fair". This is a fairy tale, they are out to dominate.. and will take whatever steps necessary to make sure that happens, economic or military. Their own population is just a tool towards this endgame.

    Ever wonder how Pakistan got nukes? China.

    Wonder how North Korea got nukes through Pakistan? China made the intro.
    That way, their hands were clean but they were able to create a permanent buffer zone on the Korean peninsula and pre-empt any German equivalent of reunification which would put a functioning democracy on their doorstep.

    China is playing a dangerous game and people who think prosperity will make them fat and happy are completely mistaken.. the economy is a tool for them both to placate their population and to wield as a weapon on the international stage.

  • Have they no honor?

  • Contents of documents ... (Score:4, Funny)

    by Kaz Kylheku ( 1484 ) on Thursday July 22, 2010 @09:20PM (#32999094) Homepage

    Probably just a list of what "Made in China" parts to use from what supplier and how to put them together. :)

  • So, they are being charged with a total of 40 years jail time and $750K in fines for information worth 40 million?

    The 40 years is definitely nasty, but looking at the 750K, I've gotta think.. that's like 3 dollars worth of mp3's if they had them online. Seems like GM would get a better deal by getting them charged with copyright infringement per page stolen.

  • Right?
    After all, you're only copying the data, not stealing it from GM, so it's not theft.

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