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Warner Norcross + Judd LLP is a corporate law firm with over 230 attorneys serving clients in nine offices throughout Michigan. Among the largest law firms in Michigan, Warner works in virtually all areas of business law.

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Two years into Donald Trump’s administration, the White House Office of Trade and Manufacturing Policy issued a report titled “How China’s Economic Aggression Threatens the Technologies and Intellectual Property of the United States and the World.” It described China’s methods of acquiring American technology and intellectual property, such as physical and cyber theft, forced technology transfers, evading export controls and restraints, and cyber hacking to sustain China’s increasing sophistication in high-tech industries.

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In response, the Trump administration created the China Initiative. This was a national security program within the Department of Justice (DOJ) designed to focus resources on identifying and prosecuting individuals suspected of economic espionage and aiding the Chinese government through trade theft and hacking. This national security concern remained into President Joseph Biden’s administration, and the China Initiative continued identifying criminal efforts by the Chinese government for over a year.

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Notable China Initiative-Related Prosecutions

Under this initiative, the DOJ has prosecuted various individuals accused of economic espionage and assisting the Chinese government. Some recent examples:

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As prosecutions under the China Initiative ramped up, so did criticism of the program. Civil rights groups, academics and scientists criticized the program for racial profiling, arguing that instead of prosecuting espionage more broadly, the focus on those with ties to China only increased intolerance and prejudice towards Asian Americans. In addition, the MIT Technology Review found that 88 percent of the defendants charged during the first three years of the initiative were of Chinese descent but were not charged with economic espionage. Rather, they were targeted for having what the DOJ called a “nexus to China,” which included anyone who had any ancestry or association with Chinese students and universities. As a result, many prosecutions included cases regarding university grant frauds, as opposed to theft of American technology and intellectual property. This left many critics wondering whether the true purpose of the program – national security – was being served.

Amid these criticisms, Assistant Attorney General Matt Olsen announced a formal end to the program in February 2022. Olsen emphasized that the DOJ would continue prosecuting economic espionage, but rather than focusing on just China, the program will center on economic espionage more broadly and include other nation-states. The National Security Division will also have more oversight over the program. Additionally, the DOJ will approach grant fraud cases – which often target professors and researchers – differently by pursuing civil or administrative actions instead of criminal prosecutions. Whether this adjusted approach will succeed remains to be seen.

For more information regarding the China Initiative or technology and intellectual property theft, please contact Madelaine Lane or a member of the White Collar Criminal Defense Practice Group.

<em>2022 Summer Associate Venesa Haska contributed to this eAlert.</em>

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DOJ Formally Ends Trump Administration’s China Initiative

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DOJ Formally Ends Trump Administration’s China Initiative

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