Former Engineer Sentenced For Possessing Stolen Semiconductor Trade Secret

The U.S. Attorney’s Office, District of Massachusetts, released the below information:

BOSTON – A Lexington, Mass. man was sentenced in Boston federal court for possessing the stolen prototype design of a microchip, known as the HMC1022A, which was owned and developed by his former employer, Analog Devices, Inc. (ADI), a semiconductor company headquartered in Wilmington, Mass. This chip is used in both aerospace and defense applications.

Haoyang Yu, 45, was sentenced by U.S. Senior District Court Judge William G. Young to six months in prison to be followed by three years of supervised release, during which he may not work in the microchip industry. Yu was also ordered to pay a fine of $55,000 and restitution to be determined at a later date. In May 2022, following a month-long trial, a federal jury convicted Yu of possessing ADI’s stolen trade secret. The jury acquitted Yu of alleging possession of other stolen trade secrets, wire fraud, immigration fraud, and the illegal export of controlled technology. 

“This prosecution demonstrates the Department of Justice’s commitment to protecting the integrity of the semiconductor market, as this technology plays a critical role in both our country’s industrial policy and geopolitical strategy. Mr. Yu stole intellectual property from his employer, plain and simple, and used that pilfered information to line his own pocket. I commend the work of the Department of Commerce, the Department of Homeland Security, the FBI, and the Naval Criminal Investigation Service in their dedicated work to the investigation and prosecution of this matter,” said Acting United States Attorney Joshua S. Levy.
    
“Yu was convicted by a federal jury of stealing trade secret associated with the design for a semiconductor utilized in defense and aerospace industries. As a result of an intensive investigation, Yu is facing federal prison for his crime,” said Michael J. Krol, Acting Special Agent in Charge of the Homeland Security Investigations in New England. “HSI works tirelessly with our local, state, and federal partners to ensure the security of sensitive U.S. strategic technologies and will continue to disrupt and dismantle any attempts to obtain them for financial gain.”

“Today, Mr. Yu learned his fate for possessing a stolen semiconductor trade secret for his own financial gain. Thankfully, his actions did not destroy his former employer’s business,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division. “While we all welcome fair competition, the FBI will not tolerate stealing and cheating. It’s illegal, unethical, and unfair, and this type of criminal conduct hurts American businesses, jobs, and consumers.”

Between 2014 and 2017, Yu worked at ADI, where he designed microchips used by the communications, defense, and aerospace industries. Through his employment, Yu had access to various kinds of ADI intellectual property, including present and future microchip designs, schematics, layouts, modeling files, customer lists, and ordering histories.  

While employed at ADI, Yu used this information to start his own microchip business, Tricon MMIC, LLC.  Forensic analysis later showed that Yu’s personal, at-home computer held exact, bit-for-bit copies of hundreds of ADI intellectual property files. Trial evidence showed that Yu had accessed these files on ADI’s secure servers, copied them, changed their filenames – often to those of cartoon characters, and then saved them on his personal electronic accounts and devices.  

Trial evidence showed that all of the chips Yu’s business sold were built with ADI’s stolen intellectual property.  In particular, Yu used the stolen HMC1022A design to manufacture two knock-off versions of ADI’s chip. Yu then began selling his versions of the HMC1022A to ADI’s customers and others even before ADI went to market with its own completed design.  In all, before his arrest, Yu manufactured about 10,000 chips built with stolen ADI property and grossed about $235,000. ADI cooperated fully in the government’s investigation.

Acting U.S. Attorney Levy; Rashel Assouri, Special Agent in Charge of the Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, Boston Field Office; HSI Acting SAC Krol; FBI SAC Bonavolonta; and Michael Wiest, Special Agent in Charge of the Naval Criminal Investigative Service, Northeast Field Office made the announcement today. U.S. Customs and Border Protection, Coast Guard Investigative Service, Defense Criminal Investigative Service, Massachusetts State Police and the Lexington and Hingham Police Departments provided assistance with the investigation. Valuable assistance in the case was provided by the National Security Division’s Counterintelligence and Export Control Section. Assistant U.S. Attorneys Amanda Beck, Jason A. Casey and John A. Capin of Levy’s National Security Unit prosecuted the case.