U.S. Lawmaker Plans Bill Targeting Chinese Intellectual Property Theft

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WASHINGTON — A Texas congressman said Nov. 14 he plans to introduce a bill, possibly before the end of the month, that would authorize American lawyers to sue the Chinese government and its corporations for thefts of intellectual property, some of which is used for the U.S. space program.

Rep. John Culberson (R-Texas) said the bill is needed to prevent “absolutely terrifying” computer hacking and intellectual property thefts by the Chinese.

“Chinese companies are attacking and stealing every bit of intellectual property they can get their hands on,” Culberson, a member of the House Appropriations Committee, said.

Congress has sought to protect American intellectual property through several legislative proposals recently.

Another one was introduced Nov. 4 by Rep. Steve King (R-Iowa), who proposes that the U.S. government impose duties on Chinese merchandise equal to annual losses suffered by patent owners for intellectual property thefts in China.

The U.S. International Trade Commission estimates U.S. businesses lost $48.2 billion in sales, royalties and license fees in 2009 from Chinese intellectual property violations.

Culberson spoke Nov. 14 on Capitol Hill during a seminar organized by the Space Transportation Association on China’s space program and intellectual property thefts.

“I found a very effective way of dealing with cyber-threats,” Culberson told Space News. “Why not unleash America’s trial lawyers on the Chinese?”

Under international law and custom, foreign governments and their corporations can be sued only if they consent to a lawsuit.

Culberson said the consent requirement might be avoided for China because of the substantial investments and assets owned by the Chinese in the United States.

If American businesses win intellectual property lawsuits against the Chinese but they refuse to pay the damages, courts could seize their assets in the United States to pay the debt, he said.

“You get to own the Chinese telecommunications equipment in the United States,” he said.

The bill he plans to introduce would allow triple damages and court costs against the Chinese government or Chinese companies that pirate U.S. intellectual property.

In addition to business losses, the United States faces military threats from China’s growing space program, he said.

“Clearly the greatest threat we face is China,” Culberson said.

If thefts of space technology continue, the United States risks losing “the high ground” to China’s military, he said.

The Capitol Hill seminar came two days after a meeting between U.S. President Barack Obama and Chinese President Hu Jintao at the Asia-Pacific Economic Cooperation forum in Honolulu.

Obama complained to Hu about China’s lax enforcement of intellectual property law and its undervalued currency, which put U.S. companies at a disadvantage for international competition.

During televised comments at the forum, Obama said the U.S. relationship with China was “off kilter” and China was too “grown up” to disregard international rules.

On previous occasions, Hu warned that a tough clampdown by the United States against China’s trade policies could threaten a trade war.

Other speakers at the Space Transportation Association seminar included Peter J. Marquez, Orbital Sciences Corp.’s vice president of strategy and planning, and Rep. Frank Wolf (R-Va.), who chairs the House Appropriations subcommittee that funds NASA.

Asked whether Culberson’s proposal to authorize lawsuits against China might incite an economic backlash, Marquez said, “I don’t know if it would cause a trade war.”

Marquez is the former White House space policy director.

Even while harshly criticizing China for its human rights policies and intellectual property thefts, Wolf hinted at the economic risk of alienating the Chinese.

“China holds a large part of our debt,” Wolf said. “There may be somewhat of a reluctance to take this on.”

Wolf outraged the Chinese last year by inserting a provision in the 2011 U.S. federal budget that prohibited NASA and the White House Office of Science and Technology Policy from joint science projects with China for the rest of the fiscal year.

“We don’t want to give them the opportunity to take advantage of our technology and we have nothing to gain from dealing with them,” he reportedly said.

 

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