Beijing AAA Technology Group, a machine tool manufacturer, discovered in 2019 that its former product manager, Tian, had systematically copied over 37,000 technical drawings and documents before leaving the company. Tian then joined Shenzhen BBB Machinery, using a pseudonym — and almost immediately became deputy general manager of a product line directly competing with Beijing Jingdiao’s core business.
The evidence showed Tian had spent his final month at Beijing AAA downloading files 162 times from the company’s servers and copying files over 70,000 times to a shared computer before transferring everything to external drives. The timeline was seamless: leave Beijing AAA, join Shenzhen BBB, start competing — using stolen technical data.
Beijing AAA sued in 2019, initially seeking RMB 92 million in damages, later raising the claim to RMB 382 million. The first-instance court awarded RMB 12.8 million. Both sides appealed.
In late 2025, China’s Supreme People’s Court issued its final ruling: Shenzhen BBB’s infringement was “clearly malicious and of a serious nature.” The court multiplied the damages to RMB 382 million — thirty times the original award.
Key Points:
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The damages calculation.
The Supreme Court calculated that Beijing Jingdiao had invested RMB 363 million in R&D for the glass-grinding machines at issue. Shenzhen BBB and Tian effectively obtained that technology at near-zero cost — a direct measure of the harm and a basis for the substantial award.
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Where infringement is willful and of a serious nature, punitive damages may apply.
The Supreme Court found “clearly malicious” conduct, evidenced by the scale of the theft (37,000+ documents), the use of a pseudonym during hiring, and the rapid market entry using stolen technology. The multiplier effect — from RMB 12.8 million to RMB 382 million — reflects the punitive damages framework.
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Beyond monetary penalties.
The court ordered Shenzhen BBB to destroy all physical and electronic copies of the stolen technical documents and to issue an internal notice to all shareholders, directors, officers, and employees, requiring each to sign a confidentiality and non-infringement commitment. The obligation to cease infringement continues until the trade secrets become publicly known — potentially forever.
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Enforcement actions.
After the judgment, Beijing AAA sought asset preservation. Shenzhen BBB’s 100% equity interests in two major subsidiaries — Yibin BBB and Zhejiang BBB— were frozen, representing RMB 400 million in value.
China’s courts are serious about trade secret protection. The 2025 Supreme People’s Court rulings, including this RMB 382 million award and a separate RMB 166 million award in another trade secret case, show a clear trend: willful infringement carries real, punitive consequences. For companies hiring talent from competitors, this case offers clear warnings.
Related Regulations:
Article 219 of the Criminal Code criminalizes trade secret theft. Under the 2025 Supreme People’s Court and Supreme People’s Procuratorate judicial interpretation, “theft” includes illegal copying, and “electronic intrusion” covers unauthorized or excessive access to computer systems to obtain secrets. Criminal liability attaches where losses exceed RMB 300,000 or illegal gains exceed RMB 300,000, with “particularly serious” consequences where the threshold is met at ten times the base amount.
The 2020 Supreme People’s Court Judicial Interpretation on Trade Secret Civil Cases provides detailed rules for calculating damages. Where a trade secret has been stolen and used, damages can be calculated based on the right holder’s lost profits, the infringer’s illegal gains, or a reasonable royalty. Where the secret has been made public, damages may include the secret’s development cost and commercial value.
You may check our previous post for more information: The Protection of Trade Secrets in China
