The State Administration for Market Regulation (SAMR) released six typical cases of trade secret infringement on the 20th.
Case One: Shanghai Yangpu District Market Supervision Bureau Penalizes Xuejing Electronic Technology (Shanghai) Co., Ltd., Nanjing Jiulanwen Instrument Technology Co., Ltd., Xu, and Guan for Trade Secret Infringement
Xu and Guan, former R&D personnel of Anmou Technology (Shanghai) Co., Ltd. (the rights holder), had knowledge of the technical secrets of the "Two-Dimensional Gas Chromatograph Solid-State Thermal Independent Modulator" (TIM) and signed confidentiality agreements with the rights holder. They left the rights holder in 2015 and established Xuejing Electronic Technology (Shanghai) Co., Ltd. (Xuejing Company) and Nanjing Jiulanwen Instrument Technology Co., Ltd. (Jiulanwen Company), continuing to engage in the R&D, production, and sale of solid-state thermal modulators. From August 17, 2016, to March 26, 2024, the solid-state thermal modulators sold by Xuejing and Jiulanwen used technical secret information from TIM. Additionally, the parties disclosed TIM's technical secret information to the public by filing invention patent applications.
Xuejing and Jiulanwen violated Article 9, Paragraph 3 of the Anti-Unfair Competition Law of the People's Republic of China (2019 Amendment), while Xu and Guan violated Article 9, Paragraph 1, Item (3) and Paragraph 2 of the same law. On September 15, 2025, considering the nature of the infringement, its duration, and the extent of damage, the Shanghai Yangpu District Market Supervision Bureau, pursuant to Article 21 of the law, confiscated illegal gains of RMB 77,800 and imposed a fine of RMB 730,000 on Xuejing Company; confiscated illegal gains of RMB 214,700 and imposed a fine of RMB 770,000 on Jiulanwen Company; fined Xu RMB 100,000; and fined Guan RMB 100,000.
Xu and Guan's use of technical secret information acquired before leaving their positions to establish companies and produce and sell infringing products exemplifies the typical "individual leakage plus corporate profit" model of trade secret infringement. Law enforcement's full-chain accountability approach targeting Xuejing, Jiulanwen, Xu, and Guan not only strikes at the organizers and implementers of the infringement but also severs the interest chains through which individuals or companies attempt to evade legal liability, creating a powerful deterrent effect. In this case, law enforcement went beyond a single administrative penalty, actively promoting both settlement between the parties and administrative punishment. By building a communication platform and organizing ten rounds of negotiations, a settlement agreement covering compensation amounts and patent ownership was ultimately reached. This enforcement practice demonstrates that resolving disputes through settlement is also an effective way to optimize the ecosystem for trade secret rights protection.
Case Two: Jiangsu Liyang Market Supervision Bureau Investigates Xie and Chen for Infringing Trade Secrets in the Heavy Machinery Sector
In the heavy equipment manufacturing sector, core technical drawings are a company's key technical assets for maintaining market competitiveness and are typical technical trade secrets. The PGS roll crusher and B-series apron feeder produced by a certain Liyang heavy machinery company (the rights holder) are well-known and highly competitive in the industry. From 2019 to 2021, Xie, lacking his own technical R&D capabilities, opened a company engaged in heavy equipment manufacturing and illegally obtained the rights holder's technical secrets through multiple channels for improper gain: first, by purchasing equipment technical drawings from Wang, a former technician of the rights holder; second, by leveraging outsourced cooperation arrangements to demand that Chen, the production manager of the finishing workshop at the rights holder's outsourcing partner, provide the rights holder's equipment technical drawings; and third, by recruiting Du, a former assembler of the rights holder, as his workshop director to obtain relevant drawing materials through Du. Notably, the drawings Du provided were only outer shell drawings and did not involve core confidential points. Using the illegally obtained core technical drawings, Xie produced and sold five units of similar machinery. After the case was exposed, Xie compensated the rights holder RMB 3,800,000 in economic losses, while Chen and Du each compensated RMB 100,000 and RMB 50,000 respectively.
Xie's acquisition and use of the rights holder's trade secrets through improper means violated Article 9, Paragraph 1, Item (2) of the Anti-Unfair Competition Law (2019 Amendment). Considering the case circumstances and compensation status, on January 6, 2025, the Liyang Market Supervision Bureau, pursuant to Article 21 of the law, ordered Xie to cease the infringing acts and imposed a fine of RMB 100,000. Chen's disclosure of the rights holder's trade secrets to others in violation of confidentiality obligations violated Article 9, Paragraph 1, Item (3) and Paragraph 2 of the law. On January 6, 2025, the bureau ordered Chen to cease the infringing acts and imposed a fine of RMB 50,000. Following investigation and appraisal, because the drawings provided by Du fell outside the confidential points identified by the rights holder for appraisal, no administrative penalty was imposed on Du. Wang had already received criminal punishment.
This case is a typical multi-party composite trade secret infringement case, breaking through the conventional single-actor infringement enforcement model. Law enforcement clarified the liability boundaries of the multi-channel leakage chain—"external operator solicitation, outsourced personnel disclosure, and former employee transfer"—precisely distinguishing core confidential points from non-core information, and imposing penalties on different parties based on the circumstances of their infringement to achieve proportionate punishment. This provides an enforcement reference for handling similar multi-party trade secret cases. The case also offers guidance for manufacturing companies on trade secret compliance management. Companies must establish a comprehensive trade secret protection system, clearly define the scope of confidentiality and control measures, sign confidentiality agreements with core internal staff and conduct regular confidentiality training, and also bring outsourced partners and former employees within the scope of confidentiality management. Improving full-process control mechanisms for confidential materials and building protective barriers from the source will support the standardized and innovative development of the equipment manufacturing industry.
Case Three: Hangzhou Market Supervision Bureau Investigates Sun for Infringing Trade Secrets in the AI Large Model Sector
With the rapid development of AI large models and fast-evolving technology, companies are increasingly inclined to protect new types of technical information such as prompt engineering and Agent skill packs through trade secrets. In July 2011, Sun joined a Hangzhou AI company (the rights holder) as a senior algorithm expert, working there until July 2025, and was fully responsible for leading the R&D of a vertical-domain AI intelligent review model, possessing core confidential materials related to the model. In December 2023, while still employed, Sun used his spouse's identity to register and effectively control Fayuan (Hangzhou) Technology Co., Ltd. (Fayuan Company). In June 2024, Sun sent the rights holder's proprietary AI model prompt templates, review rules, annotation standards, and related materials to Fayuan's R&D personnel for use in developing a similar AI model. Expert evaluations confirmed that the combination of these materials formed an integrated scenario-based intelligent review solution that met the criteria of being non-publicly known, commercially valuable, and subject to the company's confidentiality controls, constituting a new type of integrated technical trade secret in the AI vertical domain.
As a core confidential algorithm employee who signed a special confidentiality agreement upon joining in July 2011, Sun had confidentiality obligations both during and after his employment. His unauthorized disclosure of the rights holder's core confidential materials violated Article 9, Paragraph 1, Item (3) and Paragraph 2 of the Anti-Unfair Competition Law (2019 Amendment). On May 28, 2026, the Hangzhou Market Supervision Bureau, after comprehensive consideration, ordered Sun to cease the disclosure and authorization activities and imposed a fine of RMB 350,000 pursuant to Article 21 of the law. The infringement case against Fayuan Company was handled separately.
This case is the first of its kind in China involving trade secrets in a vertical AI large model, breaking through traditional enforcement limitations in the AI industry. Previously, AI intellectual property rights protection was largely confined to source code confirmation. This case breaks the industry's "code complex," adapting enforcement perspectives to AI industry characteristics and clearly establishing that natural language-based integrated solutions and non-standard operational rules can independently constitute trade secrets. The handling of this case explores the path for identifying trade secrets in non-standard integrated AI technologies, fills the gap in domestic AI industry trade secret enforcement, sets compliance red lines for algorithm talent mobility, peer AI R&D, and confidential data management in tech innovation companies, and supports the standardized and innovative development of the AI industry.
Case Four: Hangzhou Market Supervision Bureau Investigates Xie and Hangzhou Xinchuan New Materials Co., Ltd. for Trade Secret Infringement
Nano alloy powder is widely used in semiconductor chip manufacturing and other fields. High-temperature nano alloy powder molding technology involves extensive technical information including process design, materials science, high-temperature flow field layout, and dual-head cooling technology. A certain Zhejiang materials company (the rights holder), after long-term technical development, holds a competitive advantage in relevant international fields. In 2014, Xie joined the rights holder and signed a confidentiality agreement, gaining access to the technical information in question during his employment. Xie left in 2017. In November 2019, Xie established Hangzhou Xinchuan New Materials Co., Ltd. (Xinchuan Company) and disclosed the trade secrets to the company for large-scale production. In March 2022, the Hangzhou Market Supervision Bureau initiated an investigation into Xie and Xinchuan Company following a report. Investigation and appraisal confirmed that parts of the technical information involved were identical between the two companies. The parties argued that the technology was public knowledge and submitted evidence including expired foreign patents, but failed to provide materials documenting their own R&D process. The enforcement authorities conducted cross-regional collaborative investigations and commissioned experts for multiple technical reviews. The reviews concluded that the technology involved multiple disciplines and was highly complex; expert opinions on the non-public nature of the information were divided, making administrative identification of the trade secret difficult. Accordingly, the enforcement agency advised the rights holder to pursue civil litigation, leveraging the advantage of burden of proof reversal in civil proceedings. In the civil case, the court obtained evidence materials from the administrative enforcement process, and both trial levels found Xie and Xinchuan Company jointly liable for infringement.
The Hangzhou Market Supervision Bureau determined that Xie's disclosure of trade secrets in violation of confidentiality obligations violated Article 9, Paragraph 1, Item (3) and Paragraph 2 of the Anti-Unfair Competition Law (2019 Amendment), and that Xinchuan Company, as a competitor in the same industry, knowingly obtained and used the trade secrets despite Xie's breach of confidentiality obligations, violating Article 9, Paragraph 3 of the law. On March 28, 2025, the bureau ordered Xie and Xinchuan Company to cease their violations and imposed fines of RMB 300,000 each pursuant to Article 21 of the law.
This case is a typical example of dual-party infringement involving a former employee leaking secrets and a company illegally using them in the high-temperature alloy powder industry. The technical secrets involved were highly specialized and difficult to identify. Under the guidance of market supervision authorities, the rights holder used multiple means including administrative-civil coordination, leveraging evidence obtained through administrative enforcement combined with burden of proof reversal in civil litigation to successfully protect its rights, providing an excellent model for rights holders in similarly complex cases.
Case Five: Zibo High-tech Zone Market Supervision Bureau Investigates Ji for Trade Secret Infringement
An infringer stole a company's core technology and improperly filed a patent application for personal gain, causing the company's technical secrets to be publicly disclosed and resulting in enormous losses. Ji was formerly an employee of a Shandong intelligent equipment company (the rights holder) and was deeply involved in technical research for one of the rights holder's core R&D projects. On August 7, 2024, prior to his resignation, Ji violated the company's confidentiality system by unauthorizedly emailing the project's technical drawings to his personal email address. On September 12 of the same year, Ji filed an invention patent application with the China National Intellectual Property Administration (CNIPA) in his children's names. After learning that the rights holder was also preparing to file a patent application for the technology, Ji withdrew the patent application on November 22. When the rights holder submitted its patent application in December 2024, it learned from CNIPA that the technical information had been publicly disclosed through the prior patent application, losing its novelty and preventing normal patent filing. The rights holder promptly reported the matter to the local market supervision authority. Investigation confirmed that the technical information was non-publicly known before the patent application, the rights holder had invested RMB 170,000 in R&D, and had taken appropriate confidentiality measures, leading to its lawful identification as a trade secret. With active coordination by the enforcement authorities with CNIPA, the rights holder was assisted in successfully obtaining patent authorization.
Ji's actions violated Article 9, Paragraph 1, Item (3) and Paragraph 2 of the Anti-Unfair Competition Law (2019 Amendment), constituting trade secret infringement. Given Ji's active cooperation with the investigation, and the settlement reached with the rights holder including a letter of understanding, the Zibo High-tech Zone Market Supervision Bureau, considering the circumstances and his remorse, ordered Ji to cease the violations and imposed a fine of RMB 30,000 on July 9, 2025, pursuant to Article 21 of the law.
This case is typical of trade secrets being destroyed through theft and improper patent filing. Unlike conventional infringement, patent publication causes the technology to enter the public domain, fundamentally and irreversibly destroying the "secrecy" requirement—a core element of trade secrets—with finality of damage. This case breaks from the traditional enforcement inertia of "focusing on infringement punishment while neglecting rights restoration," establishing an enforcement approach that emphasizes both infringement accountability and rights restoration. While lawfully pursuing the actor's legal liability, the authorities proactively coordinated with CNIPA to provide supporting documentation, clarified and corrected the patent ownership through administrative confirmation procedures, achieved substantial restoration of the intellectual property rights status, effectively halted the loss of core technology, and maximized recovery of the company's losses. This provides a replicable enforcement model for handling malicious patent squatting cases involving confidential technologies.
Case Six: Chongqing Liangjiang New Area Market Supervision Bureau Investigates Yu for Infringing Trade Secrets in the Digital Cultural and Creative Sector
The digital cultural and creative industry is booming, with short dramas, online literature, and digital content rapidly emerging. Creative scripts are the lifeblood of cultural and creative enterprises and represent the innovative achievements of creators. However, new business forms bring new risks—script leaks, idea theft, and other infringements are eroding the foundation of industrial innovation. In May 2023, Yu joined a Chongqing media company (the rights holder) and signed an employee confidentiality agreement, serving as a production assistant responsible for overall production coordination. From December 2023 to January 2024, the rights holder independently created the short drama script "Another New Year's Eve" (also known as "My Beautiful Mother") and planned to produce and release it as a short drama. To protect this business information, the rights holder uploaded the script to the company's "Feishu" office system, restricting access to a limited group and logging visits and downloads. On January 20, 2024, Yu, leveraging his authorized access to the company's "Feishu" office system, downloaded the script and stored it on a USB drive. In late January 2024, Yu provided the script to another company (which was unaware of the infringement) during a work opportunity, and the script was subsequently produced into a short drama and aired on major platforms, causing the rights holder losses of RMB 342,000 in production costs.
Yu's unauthorized acquisition and disclosure of the short drama script, which possessed trade secret attributes, in violation of confidentiality obligations, violated Article 9, Paragraph 1, Item (3) of the Anti-Unfair Competition Law (2019 Amendment). On March 12, 2026, the Chongqing Liangjiang New Area Market Supervision Bureau, considering factors including Yu's proactive compensation for losses after the case, ordered cessation of the violations and imposed a fine of RMB 50,000 pursuant to Article 21 of the law.
The handling of this case achieved three breakthroughs. First, it included unpublished short drama scripts under business information protection, clarifying that creative core information such as concepts, scripts, and planning proposals that meet the requirements of secrecy, value, and confidentiality can be protected under the Anti-Unfair Competition Law, covering the entire cycle from creation and preparation to release, and filling the gap in intellectual property protection for the digital cultural and creative industry. Second, it clarified the boundary between trade secrets and copyright. Copyright protection focuses on original expression and protects fixed forms of works, remaining protected after publication. Trade secret protection focuses on undisclosed business information, maintaining competitive advantage through confidentiality. Third, it protects the industrial innovation ecosystem. Law enforcement's crackdown on leakage and infringement deters unfair competition, guides business entities to uphold integrity, and safeguards innovative development in the cultural and creative industry.
Trade secrets are important intellectual property and core competitiveness for enterprises. Strengthening trade secret protection is a key task in intensifying anti-unfair competition efforts. It is of great significance for stimulating corporate innovation vitality, optimizing the business environment, and promoting high-quality economic development. Protecting trade secrets means protecting innovation and development.