China-Based Company Owners Charged For Leaking US EV Firm’s Trade Secrets

Owners of a China-Based company have been charged with conspiracy to send trade secrets of a leading U.S.-based electric vehicle company.

Klaus Pflugbeil, 58, a China-based Canadian citizen, was arrested Tuesday in Nassau County, New York, for conspiring with co-defendant Yilong Shao of China to send to undercover law enforcement officers valuable proprietary technology that belonged to the U.S. electric car manufacturer and using it to set up a rival business overseas. The Department of Justice did not disclose the company’s identity.

Shao remains at large.

“The defendants set up a company in China, blatantly stole trade secrets from an American company that are important to manufacturing electric vehicles, and which cost many millions of dollars in research and development, and sold products developed with the stolen trade secrets,” said U.S. Attorney Breon Peace for the Eastern District of New York.

Klaus Pflugbeil and Yilong Shao allegedly used stolen confidential information, developed by their previous employers, to establish their own Chinese-based competitor, said Assistant Director in Charge James Smith of the FBI New York Field Office.

According to court documents, Pflugbeil and Shao are operators of a China-based business that sold technology used for the manufacture of batteries, including batteries used in electric vehicles.

Since July 2020, they expanded their business to locations in China, Canada, Germany, and Brazil.

If convicted, Pfugbeil faces a maximum penalty of 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The FBI is investigating the case.

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