By Philip Elmer-DeWitt
June 16, 2011

Three conspirators are fined and imprisoned for stealing Apple’s secrets

In early December, when the original iPad was a hot-selling Christmas gift and the iPad 2 was still a rumor, there appeared on the Internet colorful images of silicone iPad cases that didn’t fit the current model. For one thing, they each had a hole in the back that could accommodate a rear-facing camera.

Was it a hoax, a guess or an unauthorized leak? At the time, nobody knew for sure.

Now we know. On Tuesday, a Chinese court announced that it had fined and sentenced three people to prison for conspiring to steal Apple’s (AAPL) secret iPad 2 design. According to the official court report issued through a Chinese microblogging service, this is how the deal went down:

  • Xiao Chengsong, general manager of Shenzhen MacTop Electronics Co., offered 20,000 yuan (about $3,000), plus discounts on MacTop products, to Hou Pengna, a former employee at Hon Hai, which builds iPads for Apple, for information about the new model.
  • Ms. Hon then paid Lin Kecheng, who worked in Hon Hai’s research and development department, for digital images of the iPad 2’s back cover.

  • The images made their way back to MacTop Electronics, which used the specs to produce silicone covers in a rainbow of colorful designs.
  • The covers were advertised to wholesalers on Alibaba.com, a Chinese business-to-business site, where they were spotted by bloggers in the U.S. and, shortly thereafter, by Apple. The images were removed and an investigation begun.

Ms. Hon then paid Lin Kecheng, who worked in Hon Hai’s research and development department, for digital images of the iPad 2’s back cover.

For their trouble, Xiao was sentenced to 18 months in prison and fined 150,000 yuan ($23,000), Mr. Lin was sentenced to 14 months and fined 100,000 yuan ($15,000), and Ms. Hou was sentenced to a year in prison and fined 30,000 yuan ($4,600).

Via: The
Wall Street Journal.

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