Phillips 66 scientist sentenced to 2 years for stealing $1B of trade secrets

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Former employee of Phillips 66 Hongjin Tan received a 2-year prison sentence.

Chinese national Hongjin Tan, 36, was sentenced to two years in federal prison in federal court Thursday (Feb. 27) for stealing proprietary information worth more than $1 billion from his employer, Phillips 66, a US petroleum company.

Tan, 36, and a permanent resident of the US, pleaded guilty in November and admitted to copying and downloading proprietary material without his employer’s permission.

“This investigation and prosecution uncovered another instance of China’s persistent attempts to steal American intellectual property,” said Assistant Attorney General for National Security John C. Demers. 

From June 2017 until December 2018, Tan was employed as an associate scientist at the petroleum company and was assigned to work in a group with the goal of developing next generation battery technologies for stationary energy storage, specifically flow batteries. In his plea agreement, Tan admitted to intentionally copying and downloading the technologies’ research and development materials without authorization from his employer.

Later that day, he returned the thumb drive, claiming that he had forgotten to do so before leaving his employer’s property. Upon examination, it was discovered that there was unallocated space on the thumb drive, indicating five documents had previously been deleted. Investigators with the FBI searched Tan’s premises and found an external hard drive. They discovered that the same five missing files from the thumb drive had been downloaded to the hard drive. Tan maintained the files on a hard drive so he could access the data at a later date. 

Besides meting out Tan's sentence, US District Judge Gregory K. Frizzellordered the defendant to pay $150,000 in restitution to his former employer. Following his release from prison, Tan will spend three years on supervised release.

“American ingenuity inspires advances in science and technology and drives world markets. Nowhere is that more true than in Oklahoma’s energy industry. Unscrupulous individuals like Hongjin Tan seek to steal American trade secrets to take home to China so they can replicate our technology,” said U.S. Attorney Trent Shores for the Northern District of Oklahoma.

The same day Tan was sentenced, the FBI arrested a University of Tennessee professor for hiding his alleged association with a Chinese university in his application to NASA. Federal law forbids any ties with China by the space agency employees or prospective employees.

These two actions are part of a government crackdown against alleged agents of China and their attempts to steal intellectual property, trade secrets or technology from US institutions and businesses.

Members of Congress, led by Rep. Judy Chu, D-CA, are afraid the crackdown can easily become racial profiling of all people of Chinese descent, including American citizens. The DOJ has already mistakenly arrested US citizens and accused them of spying for China, in effect, ruining some of their careers. 

Chu, along with other Congress members, have asked the Trump administration for information and records as a result of its policy.