Engineer Arrested for Allegedly Stealing Trade Secret Technology Designed to Detect Nuclear Missile Launches and Track Missiles

 

February 22, 2024

A former engineer at a Southern California company has been arrested on federal charges alleging he stole trade secret technologies developed for use by the United States government to detect nuclear missile launches and to track ballistic and hypersonic missiles, the Justice Department announced today.

Chenguang Gong, 57, of San Jose, California, was arrested Tuesday morning. Gong, who is a native of China and became a United States citizen in 2011, is being held in custody until a detention hearing scheduled for later today.

Gong is charged in a criminal complaint with theft of trade secrets. According to court documents unsealed today, Gong transferred more than 3,600 files from a Los Angeles-area research and development company where he worked – identified in court documents as the victim company – to personal storage devices during his brief tenure with the company last year. The files Gong allegedly transferred include blueprints for sophisticated infrared sensors designed for use in space-based systems to detect nuclear missile launches and track ballistic and hypersonic missiles, as well as blueprints for sensors designed to enable U.S. military aircraft to detect incoming heat-seeking missiles and take countermeasures, including by jamming the missiles' infrared tracking ability. Some of these files were later found on storage devices seized from Gong's temporary residence in Thousand Oaks, according to the affidavit in support of the complaint.

Together with the United States government and others, the victim company "has invested tens of millions each year for more than seven years to develop the technology," the affidavit states, and it "would be extremely damaging economically" to the victim company if the technology were obtained by its competitors and "dangerous to U.S. national security if obtained by international actors."

"We will do everything to protect our nation's security, including from foreign threats," said United States Attorney Martin Estrada. "Mr. Gong, who had previously sought to provide the People's Republic of China with information to aid its military, stole sensitive and confidential information related to detecting nuclear missile launches and tracking ballistic and hypersonic missiles. We know that foreign actors, including the PRC, are actively seeking to steal our technology, but we will remain vigilant against this threat by safeguarding the innovations of American businesses and researchers."

"The FBI is committed to protecting our nation's critical technologies and to pursuing those who look to steal trade secret information for their benefit or for the benefit of foreign adversaries," said Donald Alway, the Assistant Director in Charge of the FBI's Los Angeles Field Office. "The theft of trade secrets, especially of sensitive military technology, undermines our national security, erodes U.S. competitiveness in the global market, and harms the businesses and individuals who have invested time, resources, and creativity into developing innovative technologies. Our actions today send a strong message that anyone willing to steal proprietary information from U.S. businesses will face consequences in the criminal justice system."

As alleged in the affidavit, the victim company hired Gong in January 2023 to work at one its laboratories as an application-specific integrated circuit design manager responsible for the design, development and verification of its infrared sensors. Beginning on approximately March 30, 2023, and continuing until his termination on April 26, 2023, Gong transferred thousands of files from his work laptop to three personal storage devices, including more than 1,800 files after he had accepted a job on April 5, 2023, at one of the victim company's main competitors.

Many of the files Gong allegedly transferred contained proprietary and trade secret information related to the development and design of a readout integrated circuit that allows space-based systems to detect missile launches and track ballistic and hypersonic missiles and a readout integrated circuit that allows aircraft to track incoming threats in low visibility environments. Gong also allegedly transferred trade secret files relating to the development of "next generation" sensors capable of detecting low observable targets while demonstrating increased survivability in space, as well as the blueprints for the mechanical assemblies used to house and cryogenically cool the victim company's sensors. This information was among the victim company's most important trade secrets worth hundreds of millions of dollars, according to the complaint, and many of the files were marked "[VICTIM COMPANY] PROPRIETARY," "FOR OFFICIAL USE ONLY," "PROPRIETARY INFORMATION," and "EXPORT CONTROLLED."

During the investigation, the affidavit states, the FBI discovered that, between approximately 2014 and 2022, while employed at several major technology companies in the United States, "Gong submitted numerous applications to 'Talent Programs' administered by the People's Republic of China government." The affidavit explains that "the PRC has established talent programs through which it identifies individuals located outside the PRC who have expert skills, abilities, and knowledge that would aid in transforming the PRC's economy, including its military capabilities."

In 2014, while employed at a U.S. information technology company headquartered in Dallas, the affidavit states that Gong sent a business proposal to a contact at a high-tech research institute in China focused on both military and civilian products. In his proposal, translated from Chinese, Gong described a plan to produce high-performance analog-to-digital converters similar to those produced by his employer.

On May 8, 2023, the FBI executed a search warrant at Gong's temporary residence in Thousand Oaks, California, and recovered several digital devices containing hundreds of documents marked as confidential or proprietary belonging to the information technology company, the affidavit alleges.

In another Talent Program application in September 2020, the affidavit states, Gong proposed to develop "low light/night vision" image sensors for use in military night vision goggles and civilian applications. In a video presentation included with Gong's submission, Gong used a video containing the model number of a sensor developed by an international defense, aerospace, and security company where Gong worked from 2015 to 2019.

According to the affidavit, Gong also travelled to China several times to seek Talent Program funding to develop sophisticated analog-to-digital converters. In his Talent Program applications outlined in the affidavit, Gong underscored that the high-performance analog-to-digital converters he proposed to develop in China had military applications, explaining that they "directly determine the accuracy and range of radar systems" and that "[m]issile navigation systems also often use radar front-end systems." In a 2019 email, translated from Chinese, Gong remarked that he "took a risk" by traveling to China to participate in the Talent Programs "because [he] worked for...an American military industry company" and thought he could "do something" to contribute to China's "high-end military integrated circuits."

The affidavit states that Gong "continued to seek funding from Chinese government programs through at least March 2022."

A criminal complaint is merely an allegation, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The charge of theft of trade secrets carries a statutory maximum penalty of 10 years in federal prison.

The FBI's Los Angeles Field Office is investigating this matter. The FBI's San Francisco Field Office and the U.S. Attorney's Office for the Northern District of California provided substantial assistance.

Assistant United States Attorneys David C. Lachman of the Terrorism and Export Crimes Section and Nisha Chandran of the Cyber and Intellectual Property Crimes Section are prosecuting this case. Department of Justice Trial Attorney Brendan Geary of the National Security Division's Counterintelligence and Export Control Section is providing substantial assistance.

 

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