United States Charges China with Cyber-Espionage in Unprecedented Indictment

This morning, the U.S. Department of Justice (DOJ) announced that a grand jury in the Western District of Pennsylvania has indicted five Chinese military officials on charges of computer hacking, economic espionage, and related offenses. The indictment marks the first time that the DOJ has filed charges against a state actor for cyber-theft and cyber-espionage crimes.

The indictment alleges that, between 2006 and 2014, the five individuals, while working for the Chinese People’s Liberation Army, hacked or attempted to hack into six U.S. companies in the nuclear power, solar, and metals industries to steal sensitive, non-public business information and trade secrets. The indictment alleges that the defendants stole this information to obtain economic advantages for Chinese state-owned enterprises (SOE) and other state interests. A summary of the specific allegations may be read in the DOJ’s press release about the indictment. The allegations of criminal conduct range from the defendants stealing proprietary information from Westinghouse Electric Co. about the design of its powers plants while it was in negotiations with an SOE for the construction of plants in China, to the theft of emails from the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union that contained sensitive, non-public information about the union’s strategies, including those related to disputes over Chinese trade practices.

In practical terms, the indictment is symbolic. The United States has long expressed its concern about cyber threats from abroad, including and particularly from China. The United States has now, however, publicly accused Chinese state actors of being involved in criminal cyber-attacks against the United States and its private industries, and taken a new step towards creating consequences for such conduct. Accordingly, although unlikely to result in the Chinese defendants appearing to be tried in the Western District of Pennsylvania, the indictment does send a message to China that the United States is prepared to take formal actions necessary to protect its interests, beyond the zone of closed-door diplomacy.

Topics:  China, Cyber Espionage, Cyber Threats, Cybersecurity, Data Protection, Foreign Policy, Hackers, Indictments

Published In: Antitrust & Trade Regulation Updates, Criminal Law Updates, Energy & Utilities Updates, International Trade Updates, Science, Computers & Technology Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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