The US accuses two men of stealing Tesla trade secrets
A Canadian man living in China was arrested and held in New York on Tuesday after he and a business partner were accused of selling Tesla’s secret battery production technology.
Federal prosecutors in Brooklyn asked a judge to hold Klaus Pflugbeil without bail on charges of theft of trade secrets. He was arrested after meeting undercover agents on Long Island on Tuesday and trying to sell them technology used to produce battery parts, the U.S. Attorney’s office for the Eastern District of New York said in a statement.
The second man, Yilong Shao, 47, a Chinese national, remains at large, prosecutors said. A public defender representing Mr. Pflugbeil, 58, did not respond to requests for comment late Tuesday.
Court documents identified the company whose secrets were stolen only as “a U.S.-based leading manufacturer of battery-powered electric vehicles and battery power systems.” That description and other details in court documents match Tesla’s.
Mr. Pflugbeil and Mr. Shao are both former employees of Hibar Systems, a Canadian company that sold battery manufacturing technology Tesla acquired in 2019. According to prosecutors, they had access to drawings and other documents that allowed others to copy the production process.
After selling Hibar, the men formed a company that tried to sell the company’s technology through ads on Google, posts on LinkedIn and a YouTube video, court documents show. They were aware that the technology was proprietary, prosecutors said.
Undercover agents met Mr. Shao at a trade show in Las Vegas in September and expressed interest in purchasing the information, which Tesla had confirmed was classified. The agents persuaded Mr. Pflugbeil to visit New York by telling him they wanted to make a deal.
The arrest shows that the administration “will prosecute those who engage in trade secret theft that puts U.S. companies at a competitive disadvantage, undermines innovation and creates a potential national security risk,” said Breon Peace, the U.S. attorney for the Eastern District of New York. , said a statement.