proprietary technology

2 charged with stealing battery manufacturing secrets from Texas-based EV giant

The technology allegedly stolen involves high-speed battery assembly lines that use a proprietary technology owned by Tesla. Photo courtesy of Tesla

Two men are accused of starting a business in China using battery manufacturing technology pilfered from Tesla and trying to sell the proprietary information, federal prosecutors in New York said Tuesday.

Klaus Pflugbeil, 58, a Canadian citizen who lives in Ningbo, China, was arrested Tuesday morning on Long Island, where he thought he was going to meet with businessmen to negotiate a sale price for the information, federal authorities said. Instead, the businessmen were undercover federal agents.

The other man named in the criminal complaint is Yilong Shao, 47, also of Ningbo. He remains at large. They are charged with conspiracy to transmit trade secrets, which carries up to 10 years in prison if convicted.

A lawyer for Pflugbeil did not immediately return phone and email messages seeking comment Tuesday night. Tesla also did not immediately return an email message.

The technology at issue involves high-speed battery assembly lines that use a proprietary technology owned by Tesla, maker of electric vehicles.

The two men worked at a Canadian company that developed the technology and was bought in 2019 by “a U.S.-based leading manufacturer of battery-powered electric vehicles and battery energy systems,” authorities said in the complaint. Tesla then was sole owner of the technology.

Prosecutors did not name either company. But in 2019, Tesla purchased Hibar Systems, a battery manufacturing company in Richmond Hill, Ontario. The deal was first reported by Electric Autonomy Canada.

"The defendants set up a company in China, blatantly stole trade secrets from an American company that are important to manufacturing electric vehicles, and which cost many millions of dollars in research and development, and sold products developed with the stolen trade secrets,” Breon Peace, U.S. attorney for the Eastern District of New York, said in a statement with officials with the Justice Department and FBI.

In mid-2020, Pflugbeil and Shao opened their business in China and expanded it to locations in Canada, Germany and Brazil, prosecutors said. The business makes the same battery assembly lines that Tesla uses with its proprietary information, and it markets itself as an alternative source for the assembly lines, authorities said.

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A View From HETI

Rice University researchers have published new findings that shed new light on processes like photosynthesis and solar energy conversion. Photo by Jorge Vidal/Rice University.

Rice University scientists have used a programmable quantum simulator to mimic how energy moves through a vibrating molecule.

The research, which was published in Nature Communications last month, lets the researchers watch and control the flow of energy in real time and sheds light on processes like photosynthesis and solar energy conversion, according to a news release from the university.

The team, led by Rice assistant professor of physics and astronomy Guido Pagano, modeled a two-site molecule with one part supplying energy (the donor) and the other receiving it (the acceptor).

Unlike in previous experiments, the Rice researchers were able to smoothly tune the system to model multiple types of vibrations and manipulate the energy states in a controlled setting. This allowed the team to explore different types of energy transfer within the same platform.

“By adjusting the interactions between the donor and acceptor, coupling to two types of vibrations and the character of those vibrations, we could see how each factor influenced the flow of energy,” Pagano said in the release.

The research showed that more vibrations sped up energy transfer and opened new paths for energy to move, sometimes making transfer more efficient even with energy loss. Additionally, when vibrations differed, efficient transfer happened over a wider range of donor–acceptor energy differences.

“The results show that vibrations and their environment are not simply background noise but can actively steer energy flow in unexpected ways,” Pagano added.

The team believes the findings could help with the design of organic solar cells, molecular wires and other devices that depend on efficient energy or charge transfer. They could also have an environmental impact by improving energy harvesting to reduce energy losses in electronics.

“These are the kinds of phenomena that physical chemists have theorized exist but could not easily isolate experimentally, especially in a programmable manner, until now,” Visal So, a Rice doctoral student and first author of the study, added in the release.

The study was supported by The Welch Foundation,the Office of Naval Research, the National Science Foundation CAREER Award, the Army Research Office and the Department of Energy.

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