A San Jose technology worker and his long-time colleague from Union City are accused in a new lawsuit of stealing electronic devices and trade secrets from their then-employer and posting evidence of the theft online that contained traceable digital fingerprints.
Before quitting computer-circuit giant Microchip Technology and joining a Bay Area company, Cang Nguyen of San Jose and Jerry Chang of Union City “surreptitiously stole” electronic devices and proprietary information from the Arizona-based Microchip, the lawsuit alleged.
“Nguyen and Chang did so to break into an established industry — bypassing extensive development work — and steal sales from Microchip,” claimed the lawsuit in San Jose U.S. District Court against the two men and a new company called GTMi that Chang started in 2018.
Microchip is seeking a court order forcing GTMi to return allegedly stolen devices and confidential information, and barring GTMi and the two men from any use of Microchip devices and proprietary technology. The company is also seeking unspecified monetary damages.
GTMi, Nguyen and Chang did not immediately respond to requests for comment.
At issue are Microchip’s computer capacitors, made at a Santa Clara factory the company said in the lawsuit it shut down. Before closing the plant, Microchip made a supply of the capacitors — which it uses in radio-frequency devices sold to businesses in aerospace, defense, consumer electronics and appliances — to provide inventory for years to come, according to the lawsuit.
Microchip claims it discovered the alleged theft after it lost a sale of radio-frequency devices to a decades-long customer. The buyer instead purchased the products at a lower price from GTMi, an “upstart entity” with offices in San Jose and Union City that Microchip had never heard of, the lawsuit alleged.
“Microchip set about reverse engineering certain of GTMi’s products that it was able to obtain through distributors,” according to the lawsuit filed Tuesday.
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The investigation turned up purported evidence that GTMi was distributing stolen capacitors belonging to Microchip, a 22,000-employee company valued at $50 billion on the stock market as of Friday. The capacitors were identical to Microchip’s, down to a grounding component unique to Microchip’s fabrication process, the lawsuit alleged.
Investigators also found GTMi had posted online performance-specifications sheets for products that in one case contained the name of the Microchip subsidiary that made it, and in another case contained a drawing mistake from an unpublished Microchip schematic, the lawsuit claimed.
Metadata embedded in the sheets showed Nguyen’s digital fingerprints on them, from his time at Microchip, the lawsuit alleged.
“GTMi is unfairly competing against Microchip by improperly using Microchip’s own custom tunable capacitors and Microchip’s proprietary, confidential information as if it were GTMi’s,” the lawsuit claimed.
Nguyen and Chang had worked together extensively at Microsemi Corp., which Microchip acquired in 2018, with Nguyen a manager and engineer, and Chang a director and manager, the lawsuit alleged. Chang left Microsemi in 2016, and in 2018 filed papers to incorporate GTMi, according to the lawsuit. Nguyen quit Microchip in 2019 and immediately joined Chang at GTMi, the lawsuit alleged.
