Former Silicon Valley Engineer Sentenced to Prison After Conviction for Stealing Marvell Trade Secrets

SAN JOSE—Suibin Zhang was sentenced this morning following his conviction on five felony counts of theft of trade secrets by a federal district judge, United States Attorney Melinda Haag announced today.

United States District Judge Ronald M. Whyte sentenced Zhang to serve three months in prison, to be followed by a three-year term of supervised release. Among the conditions of supervised release are that Zhang shall perform 200 hours of community service. The defendant was also ordered to pay $75,000 in restitution to the victim, Marvell Semiconductor Inc. (Marvell); that sum is to be paid in full on or before May 31, 2013. Judge Whyte stated that Zhang’s conduct was “unacceptable” and that he hoped his sentence would carry a “strong deterrent message.”

In a verdict published on May 29, 2012, Judge Whyte found Zhang guilty of three counts of theft and copying of trade secrets for downloading the trade secrets from a secure database, one count of duplication of trade secrets for loading those trade secrets onto a laptop provided by his new employer, and one count of possession of stolen trade secrets. Zhang was acquitted of three counts of computer fraud and one count of unauthorized transmission of a trade secret. The guilty verdict followed a two-and-a-half-week trial before Judge Whyte, which began on October 24, 2011 and concluded on November 9, 2011.

Evidence at trial showed that Zhang, 44, of Belmont, California, was employed as a Project Engineer at Netgear Inc., of San Jose, which gave him access to Marvell’s secure database (“Extranet”). On March 8, 2005, Zhang accepted a position at Broadcom Corporation (Broadcom), which is also Marvell’s chief competitor. Beginning the very next day, March 9, 2005, and continuing on two other days before he left Netgear, Zhang used his Netgear account to download and steal trade secret information found in dozens of documents, datasheets, hardware specifications, design guides, functional specifications, application notes, board designs, and other confidential and proprietary items from Marvell. On April 27, 2005, Zhang loaded the Marvell trade secrets onto a laptop issued by Broadcom, where they continued to reside on June 24, 2005, when the FBI served search warrants at Zhang’s home and at Broadcom and took possession of his laptop.

“The protection of intellectual property rights, especially in Silicon Valley, is of vital importance to the economic security of our region,” said United States Attorney Melinda Haag. “The investigation and prosecution of thefts of trade secrets remains a significant priority for this office. I certainly hope the court’s sentence sends a strong message that in addition to the personal, professional, and financial costs, which are significant in themselves, these offenses result in prison time.”

The conviction is the result of an investigation by the Federal Bureau of Investigation. The investigation was overseen by the Computer Hacking and Intellectual Property (CHIP) Unit of the U.S. Attorney’s Office. Matthew Parrella and David Callaway are the Assistant U.S. Attorneys in the CHIP Unit who prosecuted the case with the assistance of Legal Tech Nina Burney-Williams. Both Marvell Semiconductor Inc. and Netgear Inc. cooperated fully with the FBI in the investigation.