Canadian National Operating China-Based Company Arrested In US For Alleged Theft Of Tesla's Trade Secrets

A Canadian national residing in China was arrested on Tuesday morning for conspiring to send trade secrets belonging to American EV giant Tesla to undercover law enforcement officers.

What Happened: Klaus Pflugbeil was taken into custody in New York after he sent multiple trade secrets belonging to Tesla to an undercover law enforcement agent, Reuters reported.

Pflugbeil was operating a business that sold technology related to the manufacture of batteries together with Chinese national Yilong Shao. Shao, however, is yet to be arrested, federal prosecutors in Brooklyn said.

The prosecutors did not explicitly name Tesla but referred to it as a leading U.S.-based electric vehicle company. However, they mentioned that it had acquired a Canadian manufacturer of battery assembly lines in 2019, a description that aligns with Tesla’s acquisition of a Canadian company called Hibar, Reuters noted.

Pflugbeil and Shao are former employees of the Canadian company, the prosecutors said.

Why It Matters: "This blatant theft of advanced trade secrets relating to battery components and assembly blunts America's technological edge, and the Justice Department will hold accountable those who would so try to cheat our country of its economic potential and threaten our national security," Assistant Attorney General of the Justice Department's National Security Division Matthew G Olsen said.

As per the prosecutors, Pflugbeil faces up to 10 years in prison if convicted.

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