china initiative

A number of recent cases involving companies or individuals with a China-related background show that the U.S. government has been actively pursuing the actions under the China Initiative.

• In early 2017, ZTE, a Chinese state-owned telecommunication company, agreed to plead guilty and pay USD 1.19 billion in fines for breaking sanctions and selling electronics to Iran and North Korea. In 2018, ZTE agreed to certain additional penalties and compliance measures as a result of its violations of the settlement agreement with the U.S. government, which brought the total penalties to USD 2.29 billion.
• In November 2017, Patrick Ho, the former head of China Energy Fund Committee, was arrested in New York over alleged FCPA violations. In March 2019, Mr. Ho was sentenced to three years imprisonment in the U.S. following his conviction of bribing officials in Chad and Uganda to obtain unfair advantages.
• In October 2018, the U.S. Commerce Department decided to prohibit Fujian Jinhua Integrated Circuit (“Fujian Jinhua”), a state-owned semiconductor company headquartered in China, from buying components, software and technology goods from U.S. firms on the ground that it posed a national security threat after its U.S. competitor, Micron, accused it of trade secrets theft.
• In January 2019, the U.S. government unsealed its criminal charges against Huawei, a privately-owned Chinese tech giant, for trade secrets theft and violation of U.S. sanction on Iran. Before that, Ms. Meng Wanzhou, Huawei’s CFO and the daughter of the company’s founder, had been arrested by the Canadian government based on U.S. government’s request for extradition.
• In March 2019, Dan Zhong, a former Chinese diplomat and the head of U.S. operations of Chinese Liaoning Rilin Construction (Group) Co. Ltd., was convicted of a number of crimes including conspiracy to provide forced labor, concealing passports and immigration documents in connection with forced labor, conspiracy to commit visa fraud, etc.
• In April 2019, the U.S. Justice Department unsealed its indictment against an American Chinese engineer formerly employed by General Electric and his Chinese business partner with charges on economic espionage and trade secret theft.
• In April 2019, a prominent cancer center made adverse employment decisions against several scientists, who were suspected of disclosing confidential information regarding federally-funded research to China.
• In February 2020, Harvard University Professor Charles Lieber, Chair of the university’s Department of Chemistry and Chemical Biology, was arrested and charged criminally with making a materially false, fictitious and fraudulent statement about his involvement in the “Thousand Talents” program and affiliation with Wuhan University of Technology in China.

Dorsey & Whitney has deep experience and longstanding involvement with China-related legal issues. The firm’s U.S.-China Practice Group can help you navigate this enforcement environment. Dorsey’s uniquely positioned U.S.-China Practice Group is multi-disciplinary and spans multiple industries. We can help you identify and successfully navigate the increased risk posed to your organization or you individually by the China Initiative. Our representations including U.S. academic research institutions and organizations, individuals, and Chinese corporations.

This Group is composed of a highly-skilled team of attorneys and professionals, many of whom formerly worked at U.S. government enforcement agencies or who are bilingual and work out of offices in the United States or China. Our U.S.-China Practice Group is able to deliver around-the-clock, seamless legal services to our clients with cross-border legal needs.

Dorsey helps clients with:

• Complying with IP Policy, Ethics Rules and Grant Rules. Combining business perspectives, technical knowledge and industry experience, Dorsey attorneys help our clients protect their sources of competitive advantage and maximize their revenue streams. We assist clients with IP dispute matters and have experience representing both plaintiffs and defendants in seeking satisfactory outcomes. We also work with universities, research institutions and individual faculty members to ensure compliance with federal grant rules in government-sponsored research projects and provide guidance and advice in grant fraud investigations and litigation.
• White collar and criminal defense of companies and executives. Dorsey attorneys have decades of experience prosecuting and defending criminal charges brought by U.S. and state governments for a broad range of matters. With deep experience in the Department of Justice, Dorsey attorneys have been involved in many prominent white-collar criminal and civil fraud matters. Our clients have included large publicly and privately held corporations and partnerships, officers and directors, and individual professionals. We have extensive experience in DOJ, FBI and SEC investigations and litigation, and in parallel regulatory investigations and proceedings, and aggressively defend our clients in complex criminal trials.
• Allegations of sexual harassment and assault. Dorsey attorneys also represent companies and senior executives defending against allegations of sexual assault and harassment. As the #MeToo Movement continues, Chinese-owned companies in the U.S. and Chinese subsidiaries of U.S. companies are facing an increasing number of sexual harassment complaints from their employees. Dorsey attorneys regularly counsel companies in understanding and responding to this risk with practical advice to these global players on how to handle cross-cultural sexual harassment complaints from legal, language and cultural perspectives.
• Complying with U.S. export controls for the transfer of technology. Dorsey attorneys understand the complex regulatory landscape presented by these often interrelated U.S. export control laws and regularly advise U.S.-based and international clients on compliance with U.S. sanctions programs and export controls to mitigate operational risks. We regularly advise on the many ways the EAR and the ITAR impact businesses, and help clients investigate potential violations of the laws and navigate disclosing those violations to the relevant U.S. Government agencies.
• Foreign Corrupt Practices Act education, investigation and defense. Dorsey’s Government Enforcement and Corporate Investigations group has deep experience through decades of service with government enforcement agencies as well as in private practice counseling business organizations. Whether it's reviewing compliance procedures, planning a cross-border transaction, making an acquisition or successfully resolving an investigation, our experience will help guide your organization to the successful result it seeks. We assist clients on all aspects of compliance, anti-corruption and FCPA matters.