Chinese spies, corporate trade secrets: Maria Bartiromo, James Freeman 'The Cost'
Motorola was the victim of stolen trade secrets by the Chinese
In their new book, “The Cost” FOX Business Network anchor Maria Bartiromo and James Freeman of The Wall Street Journal review President Trump’s first term and highlight many of his policies that drove one of the greatest economic booms in U.S. history, pre-pandemic.
Trump's crackdown on China over unfair trade practices has been legendary and for good reason, as detailed in this excerpt of the book.
Chapter 6: Eyes Wide Open
It might have seemed odd to return from a long medical leave and resume work at a job in Illinois just two days before attempting to fly to China on a one-way ticket.
But in February 2007 no one at Motorola knew that their colleague Hanjuan Jin was planning to leave the United States. It wasn’t until a call came into company headquarters in Schaumburg, Illinois, the next day that it became clear something was very wrong.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MSI | MOTOROLA SOLUTIONS INC. | 492.59 | +5.26 | +1.08% |
Turns out that Jin, who worked as a software engineer for the American telecom manufacturer for nine years, had been stopped and detained during a random security search at O’Hare International Airport. She was carrying $31,000 in cash and 1,300 confidential Motorola documents—many stored on a laptop, external hard drives, thumb drives, and other devices. In the two days before attempting to flee to China, she had accessed hundreds of technical documents from Motorola’s internal network and was recorded leaving the office late at night carrying various items.
In 2012 Jin was convicted and sentenced to four years in prison and fined $20,000 for stealing trade secrets.
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U.S. District Judge Ruben Castillo called Jin’s actions “a raid in no uncertain terms. It is a raid to steal technology. You conducted this raid in the dead of night when you knew that there was a lesser chance you’d get caught.” At Jin’s sentencing, the judge said she also possessed confidential Chinese military documents and was identified as an employee of China-based Sun Kaisens, a telecommunications firm that U.S. government officials say develops products for China’s armed forces. Prosecutors later said the secrets she carried included descriptions on how Motorola produces a walkie-talkie communications feature. Motorola estimated the stolen data was worth $600 million.
TRUMP’S TAX REVOLUTION: MARIA BARTIROMO, JAMES FREEMAN 'THE COST'
Motorola also investigated Jin’s alleged ties to another company, Lemko Corporation, which in turn had a commercial relationship with rising Chinese telecom giant Huawei Technologies. Motorola reported that a number of its Chinese-born former engineers, including Jin, were working for Lemko, a small cellular technology firm that had set up shop down the street from Motorola headquarters in Schaumburg. Motorola alleged in a lawsuit that the employees were sending confidential information to the chairman of Huawei, Ren Zhengfei. The defendants denied the claims and the parties settled the case with no admissions of liability. But Motorola Solutions CEO Greg Brown joined Maria on FOX Business in December 2018 and discussed the case. “Huawei definitely stole trade secrets,” said Brown, “and we sued but we subsequently settled.”
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After the FOX Business interview, Motorola retracted Brown’s statement. The settlement’s terms prevented such comments. But no legal settlement can conceal the curious fact that right after Motorola agreed to stop suing Huawei, the Chinese government gave Motorola a critical regulatory approval the government had been sitting on for months. Coincidence?
More recently, the U.S. government has charged Huawei, founded by a former member of China’s People’s Liberation Army and now the world’s largest telecom company, with a range of offenses, including fraud and conspiracy to steal trade secrets. The company has denied the charges.
You won’t often hear a company operating in China criticize the Chinese Communist Party for fear of retribution. But for decades there has been a long list of charges, lawsuits, and indictments brought against Chinese companies for theft of intellectual property or trade secrets.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MSFT | MICROSOFT CORP. | 415.49 | -2.30 | -0.55% |
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In an interview with Maria in 2018, former Microsoft CEO Steve Ballmer said 90 percent of companies in China are using the Microsoft operating system, although only 1 percent are actually paying for it. Ballmer said the theft has to end. “I’m a free trader, by nature. . . . [I]t’s the best thing for the world,” Ballmer told Maria on FOX Business. “This one’s a tricky issue because it’s absolutely clear that the rules don’t apply in China, and the U.S. government needs to do something. . . ”
Maria Bartiromo joined FOX Business Network (FBN) as Global Markets Editor in January 2014. She is the anchor of "Mornings with Maria" on FBN (6-9 AM/ET), which is the number one pre-market business news program in cable, and anchors "Sunday Morning Futures" (10 AM/ET) on FOX News Channel (FNC), which routinely ranks as the highest-rated show on Sundays in cable news. In April 2017, Bartiromo was also named the anchor for FBN’s weekly primetime investing program "Maria Bartiromo’s Wall Street" (Fridays at 9 PM/ET). "The Cost" is her fourth book.
James Freeman is assistant editor of The Wall Street Journal’s editorial page and author of the “Best of the Web” column. He is co-author of "Borrowed Time: Two Centuries of Booms, Busts, and Bailouts at Citi," a New York Times Editors’ Choice and Financial Times Business Book of the Month. He is a Fox News contributor and former investor advocate at the US Securities and Exchange Commission.
This essay is adapted from "THE COST" by Maria Bartiromo and James Freeman. Copyright © 2020 by Bartiromo Productions LLC and James Freeman. Reprinted by permission of Threshold Editions, an imprint of Simon & Schuster, Inc. All rights reserved.