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HP IT Technology

Tale of Fake Hewlett-Packard Gear Spurs Arrest in China, Lawsuit (bloomberg.com) 45

An anonymous reader shares a report: When three Chinese nationals were jailed in Beijing almost a decade ago and accused of selling fake Hewlett-Packard networking gear, it looked like an example of U.S. companies getting what they'd long demanded: aggressive protection of intellectual property in the world's most populous nation. A drawn-out court case heading to trial in Massachusetts paints a much muddier picture. The three, exonerated in China, accuse the former Silicon Valley icon of setting them up. They argue that it was H-P units that conspired to sell counterfeit gear, and then pinned the blame on them. H-P disputes the claims, and is asking a U.S. federal judge to dismiss the lawsuit, saying the story was concocted by Integrated Communications & Technologies Inc., the Massachusetts-based company that employed the three Chinese nationals, to cover up its own criminal behavior. U.S. District Judge Leo T. Sorokin may rule on the dismissal request at any time. If he lets the case continue, a trial is scheduled for February.

Western companies have been calling on China for years to combat counterfeiting and take action against those that steal their intellectual property. One of the triggers for former U.S. President Donald Trump's trade war was the technology industry's lobbying of the American government to help protect their IP. A loss for either side in the lawsuit would tarnish its reputation in the world's largest market for computers by marking them as an organization that fraudulently sold counterfeit goods. The Office of the U.S. Trade Representative identified China as the "primary source" of counterfeit goods in a 2020 report. With Hong Kong, the document details, China accounts for 92% of the value of fake goods seized by U.S. Customs and Border Protection in 2019. In this case, the networking gear was made by an affiliate of H-P's in China, exported to India on lease, then sold back into the Chinese market.

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Tale of Fake Hewlett-Packard Gear Spurs Arrest in China, Lawsuit

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  • As in a contract manufacturer? Are they making excess quantity and selling it? Is that the case? It does not strike me as trivial to set up a shop to make networking gear. That must be a complicated and expensive plant.
    • by Aighearach ( 97333 ) on Monday August 02, 2021 @12:40PM (#61647511)

      It does not strike me as trivial to set up a shop to make networking gear. That must be a complicated and expensive plant.

      That just says how ignorant you are about electronics manufacture. The design might be complicated, but there would be no special equipment for manufacture. None. Zero. Zilch. The factory is exactly the same as a factory making other electronic devices; PCBs are not different depending on use. The pick and place machines to put the chips on the board are not different. The case, metal or plastic, is just a case; it doesn't matter what is going inside. This is just assembly of parts. This is exactly the type of manufacturing that you can have done in any smallish town in Asia.

      The hardest part is getting the logos printed convincingly. Seriously.

      • This is exactly the type of manufacturing that you can have done in any smallish town in Asia.

        Well that's probably going a little too far..

        • It isn't. It certainly isn't.

          You'd need a volume term in order to even raise questions about it.

          Notice the term "smallish?" OK, so you have to consider first the values for smallish where the statement is true . You'd have to completely fail to find applicable values for "smallish" before you'd be in a position to even raise a question about the statement. That's how stupid you are; you argue without even looking what the terms are, and if they're arguable, or if general terms were used in order to ensure

        • There's some hyperbole there, particularly the implication that the entire continent (which is mostly Russia, and also includes places like Kazakstan and Syria) has these capabilities.

          But within the bits of East Asia with major electronics industries? 100k isn't really small, but it is 'smallish.' Somebody in that town can manufacture PCBs, and somebody else can put them in plastic cases, and somebody else can print up the documentation...

          • Syria is in the Middle East. Your geography teacher failed you. Or, you're just an idiot. Not sure.

            • "Geography teacher failed me?" Pot, meet kettle.

              The Africa/Asia border is the Suez Canal, so there's a small chunk of Egypt in Asia.

      • HP Switches must be using silicon they develop. PCB manufacturing is placing components on a board. Specialized networking gear have custom FPGAs for the switch fabric.
        • They do not do the chip fab in their own factory, though. This is hilarious; why pretend and look stupid?

          FPGAs are just components you place on the board.

          I've got a box of them right here. I'll bet you don't even wonder why I would have them?

    • by Impy the Impiuos Imp ( 442658 ) on Monday August 02, 2021 @02:34PM (#61647889) Journal

      As in a contract manufacturer? Are they making excess quantity and selling it? Is that the case? It does not strike me as trivial to set up a shop to make networking gear. That must be a complicated and expensive plant.

      Correct. Much counterfeit is extras run off on the same assembly line, often with inferior parts.

      The contracts to run the lines are very explicit: no running off extra stuff!

      It can be easy to track some of this because they sell it on the Internet using the proper part numbers.

  • by theshowmecanuck ( 703852 ) on Monday August 02, 2021 @12:34PM (#61647489) Journal
    "HP, you decided to make your gear in a country having an autocratic dictatorship with a long history of antagonism to western democracies and of industrial espionage and intellectual property theft. What the hell were you thinking setting up shop in the middle of the belly of the beast. You deserve what you get if that happens to you, too. You made your bed, now lie in it. Now shut the fuck up, go away, and suffer the consequences of your greedy stupidity. And that goes for any other company that wants to make the same complaint."
    • by inode_buddha ( 576844 ) on Monday August 02, 2021 @12:46PM (#61647531) Journal

      That would be damn near every company of any size in the US.

      Napoleon said it best:
      "Money has no Fatherland; financiers are without patriotism and without decency. Their sole object is gain."

      He was a bit upset at discovering Rothschilds Bank was financing both sides of his wars. Last I heard, the French were still paying interest on it.

    • by Anonymous Coward

      Problem is that is 99% of US companies, and US companies, thanks to the Citizens United verdict, own the government. Which pretty much gives China more control over US companies than the US has.

      For example, if a big company had a built in VPN system. In the US, if the government asked them not to do it, they would post an ad and say they are championing freedom and would never bow down to tyranny. On the other hand, if China asked them not to implement it... it would be gone in seconds.

      • If that were true we wouldn't see the constant stream of anti-China rhetoric we do. What's happened is China has gotten out from under the imperialist thumb and the imperialists are panicking.
        • Re: (Score:3, Interesting)

          ... and then the guys like me, who were working-class in the companies that got sent overseas, are now pointing the finger at the imperialists and saying "See?? We told you so!!!"

          Friggen 40 years later... all those lives destroyed and all that industrial capacity wasted, all that dependence on a foreign power... just to feed some people's GREED.

          • by Bert64 ( 520050 )

            Welcome to capitalism...
            Those companies that didn't outsource and kept manufacturing local would have faced higher prices and gone out of business long ago. Once one company starts outsourcing they all have to, otherwise they won't be able to compete and will go under.

            • last I checked none of them were losing money 50 yrs ago. Like you said, once one of them went, all of them had to -- because of GREED

        • How much does the Chinese government pay you to spread Chinese propaganda? Is your terminal monitored so that everything you write on great-firewalled sites gets recorded to make sure you've maintained your ideological purity and not been corrupted by Western ideas? How about your family, is your monitored work tied to their well-being, so that if you show any sign of defiance to the Party they might be vaporized? In fact, do you know what vaporization is? As in, Har you read George Orwell's "1984"? Or is t

          • I mean, have you ever looked at the history of the United States? God Bless America and the Pledge of Allegiance were written while segregation was still the law of the land and black people still couldn't vote. We have BY FAR the highest incarceration rate(6x that of China) and you're here talking about China being the oppressors of 1984?

            The amazing thing about most Americans is they do the propaganda labor for their own oppression for free.
            • have you ever looked at the history of the United States?

              Yes, the US has a messed up History, as does my country, and as does China -- which, in terms of messed-up-ness, goes hand in hand with India's in their dispute for the top spot.

              So? Other than the hypocritical whataboutism, do you have a point, or is this just an exercise in informal fallacies?

              • You want to talk about intellectual fallacies when your reply to my comment was to question my motives and credibility instead of the content of my comment? You are repeatedly only using Ad Hominen and accusing others of "logical fallacies."
                • your reply to my comment was to question my motives and credibility

                  Your original comment had two affirmations:

                  a) "If [China having more control over US companies than the US has] were true we wouldn't see the constant stream of anti-China rhetoric we do."

                  This is false because the Chinese government isn't interested in forbidding freedom of though among Americans, it's interested in forbidding freedom of thought among its Chinese subjects within China. Among the American people, and other adversarial countries of theirs, the Chinese government wants, as any realpolitik-mind

                  • Imperialism for leftists has an actual definition, which your usage does not fit: https://en.m.wikipedia.org/wik... [wikipedia.org]

                    And yes, I oppose colonialism and imperialism, of which the US and European powers are the greatest offenders.
                    • Imperialism for leftists has an actual definition

                      Ah, yes! The old "my dictator is better than yours!" method of systematic bullshitting! A veritable classic!

                    • Not sure where you got that. I just stated we seem to have different definitions of imperialism. You never provided a clear definition of imperialism.
                    • I just stated we seem to have different definitions of imperialism.

                      Redefinition of term is a traditional modus operandi for the Marxist left in general, and for the revolutionary left in particular. Slavery gets renamed "reeducation through work". Oppressive totalitarian dictatorships get renamed as "popular democratic republics". Wars of territorial conquest get renamed "liberation fronts". And so on and so forth. As a rule of thumb, anything bad the extreme left does in the exact same way done by the extreme right, the left redefines such that the extreme left's version

                    • Yeah, you're just making stuff up on the spot. Leftists have had a tremendous effect on formalizing political linguistics ever since Marx's "Capital," such that words like capitalism have colloquially take on the Marxists definition. From my perspective it's a typical right wing mode of operation to constantly redefine words so that bad words describe themselves and good words describe the groups they dislike or want to kill or put in jail. It just so happens, Americans are so saturated in propaganda and sh
                    • From my perspective it's a typical right wing mode of operation to constantly redefine words

                      Thanks for exemplifying what I mean.

                      Americans are so saturated

                      I'm not American, nor in the USA, but I agree with this criticism. In fact, I agree with political and economic criticisms in general. The left's criticism of right-wing politics is good. The right's criticism of left-wing politics is good too. What's trashy are their respective positive proposals to "solve" what they criticize.

                      China doesn't have large scale expansionist goals.

                      Do you read the links you provide?

                    • Yes, I read the article. If you talk to a US citizen they believe China wants to rule the world. If you talk to the CCP, they want to restore the borders of the Qing dynasty and no more, which they consider "China." I'm not arguing if they are correct, just that they don't have plans for some kind of global empire like the European empires (that still defacto exist under a shadow capitalist empire).

                      Western powers after WW2 had decided unilaterally where all the borders were and the borders they set should
                    • If you talk to the CCP, they want to restore the borders of the Qing dynasty and no more

                      You're again confusing Chinese propaganda for Chinese practice. Every major world power says nice falsities that have little to nothing to do with their real practice, the placating discourse following and adapting to the later's moving goal posts, not the other way around. Case in point, the nine-dash line. Once the Qing dynasty borders are "restored" (aka "f**k peoples' self-determination, what's mine is mine" -- exactly like the Israeli, Turkish and so many other governments do), the speech will move one

  • by Stonesand ( 922187 ) on Monday August 02, 2021 @12:38PM (#61647505)
    My father, a high uppity-up at HP, was once on a business trip to China to work on a contract to sell HP equipment about 15 years ago. On the way to the meeting, they passed by stores selling fake HP printers. My Dad's team confronted the Chinese group they were meeting with about the equipment, and were told that no such counterfeit equipment even existed. So, the HP team stopped the negotiations right there and took the rest of the week off as vacation instead.
  • discovery needs to deep into all HP / 3rd party's or YOU MUST ACQUIT!

  • jurys are an crap shoot in cases like this but in an criminal you do have the right to trail by jury

  • by xlsior ( 524145 ) on Monday August 02, 2021 @12:57PM (#61647559)
    NEC also had entirely fake subsidiaries, which were both selling counterfeit versions of original product as well as entirely different product lines. NEC first discovered this after running into large amounts of warranty claims for malfunctioning equipment with serial numbers that they never created. https://www.eetimes.com/fake-n... [eetimes.com]
  • by ikhider ( 2837593 ) on Monday August 02, 2021 @01:00PM (#61647569)
    I heard the story of someone (non-Chinese) who set up a factory in China for school binders and theft was rampant. Once he made a Chinese national his partner, all theft stopped. I do not think HP et al are willing to partner up with a Chinese national to share wealth, so they can manufacture in the US if these parts are that important to them. China is a difficult place to regulate. The locals execute each other regularly for corruption and it is still a problem. Companies hand over their manufacturing secrets and then wonder why it is loose. This is all part of the high cost of low price. Manufacture local. More than that, maybe manufacture something actually good so it is worth keeping local. HP is generally lower tier.
  • China accounts for 92% of the value of fake goods seized by U.S. Customs...

    China probably accounts for about 92% of real goods also. Thus, China doesn't necessarily have a higher ratio of IP crooks, it just makes more stuff in general, real and fake.

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