HTC’s top designers arrested for stealing company’s trade secrets

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HTC has plenty of internal strife.  Following on the news in May of the turmoil caused by the departure of several executives, HTC has filed formal complaints against high-ranking employees, alleging that they stole trade secrets.  “Several Chinese papers report that HTC’s VP of product design Thomas Chien, an R&D director Wu Chien Hung, and design team senior manager Justin Huang were among five employees that planned to leave the company after collecting their mid-year bonuses yesterday”.

Richard Lai of Endgadget said that several Chinese sources have reported that HTC “caught Chien secretly downloading files related to the upcoming Sense 6.0 UI design” and forwarding it via email.  “Chien and Wu were reportedly both taken into custody following raids at HTC’s R&D center and the suspects’ homes and offices”.

HTC also alleges, that in addition to stealing trade secrets the designers inflated fees for their contribution in the design of HTC’s One smartphone.  Even though the design was done in-house, Lai says that Chien, Wu and Huang spilt an amount of over $334 000 after using an external firm to invoice HTC.  The trio apparently aims to use the technology stolen from HTC to develop new smartphones in collaboration with Chinese smartphone vendors.  They have also registered a new design company.  The China Post claims that HTC management knew about the new business.

HTC has to face two problems.  Firstly, they will have to deal with the issue of internal fraud.  However, it is the second problem that will have the bigger impact.  It seems probable that HTC will lose some vital design members, besides Haung who was personally responsible for sketching the design of the HTC One and Chien who spearheaded the entire product design team in Taiwan.

When approached for comment, HTC said that they “expect employees to observe and practice the highest levels of integrity and ethics. Protecting the company’s proprietary and intellectual properties, privacy and security is a core fundamental responsibility of every employee. The company does not condone any violation. As this matter is currently under investigation by the relevant authorities, we therefore refrain from further comments.”

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