Shanshan Du, a former GM engineer, and her husband, Yu Qin were arrested and charged Thursday with trying to sell stolen GM hybrid secrets to China.  (Source: Detroit News)

GM's Chevy Spark  (Source: TechWack)

Chery QQ  (Source: Gas Goo)
Bizarre story is a sign of growing intellectual property concerns

Man have heard of knockoff Chinese electronics clones of popular American products -- from the iPod to laptop computers.  The largely underreported story is the role intellectual property theft plays in the creation of these products.  Often Chinese engineers directly steal designs which are used to produce cheap clones.

That issue has been brought under the microscope with the arrest of Shanshan Du, 51, and her husband, Yu Qin, 49, for attempting to steal hybrid trade secrets and sell them to China according to the
Detroit News.

The bizarre story begins in 2000 when Du obtained a job working at General Motors.  Soon she became involved with hybrid vehicle efforts, and from 2003 to 2005 she collected thousands of pages of design documents and a wealth of computer files.  When she left GM in 2005, she focused on trying to sell the information on behalf of her Michigan startup Millennium Technology International, MTI, which she and her husband founded in 2000.

Her husband Qin, a U.S. citizen who immigrated from China, also appears deeply involved in the scheme.  He bragged to his friends at his workplace -- Troy, Michigan-based electrical systems and equipment maker Controlled Power Co. -- that he had scored a deal to supply hybrid technology to China's Chery Automobile.

However, the documents never got to Chery, according to the FBI.  The pair's scheme slowly unraveled.  In 2006, pursued by the feds they began destroying documents only to be charged for destruction of evidence.  Those charges were later dropped.  

Breakthroughs in the case came when the FBI seized a flash drive that Qin was keeping at Controlled Power Co., which contained some of the stolen documents.  Further progress was made when the FBI obtained copies of emails sent to Chery and others trying to sell the documents.  The pair were arrested in Michigan Thursday on conspiracy, wire fraud, and other charges.

The FBI made it clear that its taking the case very seriously.  Andrew Arena, head of the FBI in Detroit, "Theft of trade secrets is a threat to national security."

Qin's attorney, Frank Eaman, seemed resigned to the charges, starting "This investigation has been going on so long I figured if they had a basis, they would have charged them a long time ago."

Chery has fought with GM in the past over IP theft issues.  Its QQ minicar, produced in 2002 looked identical and was almost identical mechanical to GM's Chevrolet Spark.  GM's Daewoo unit in South Korea developed the Spark; GM has accused Chery of somehow obtaining its design information and used it to produce the QQ.

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