Lei Gao, Trade Secret Theft, Texas 2023

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Chinese Energy Company, U.S. Oil & Gas Affiliate and Chinese National Indicted for Theft of Trade Secrets

A federal grand jury in Texas has returned an indictment alleging corporate entities conspired to steal technology from a Houston-area oil & gas manufacturer, announced U.S. Attorney Ryan K. Patrick and Assistant Attorney General John C. Demers of the National Security Division.

Lei Gao, 45, also known as Jason Gao, a Chinese national, Jason Energy Technologies Co. (JET) in Yantai, People’s Republic of China, and Jason Oil and Gas Equipment LLC (JOG) USA, are charged with conspiracy, theft of trade secrets and attempted theft of trade secrets.

Gao previously resided in Houston but is now believed to be in China. A warrant remains outstanding for his arrest, with the charges containing in the indictment only allegations. A defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Also charged in relation to the case is Robert Erford Jr., 41, of Dayton, who worked for a Houston-area company. He previously pleaded guilty to conspiracy to commit trade secrets on or about Nov. 7, 2019, Gao allegedly met with Erford at the JOG offices located in Houston.

According to the indictment, Erford signed a consultancy agreement that Gao provided at that time, indicating Erford would work in China as a consultant to assist JOG in coiled tubing technology. Erford was to be $1,000 each day of a 15-day visit, according to the charges. This agreement allegedly also included a confidentiality provision.

The corporate entities could be fined up to $5 million or three times the value of the stolen trade secret, whichever is greater. Gao faces the same potential fine as well as a possible prison sentence of up to 10 years. The FBI conducted the investigation, with Assistant U.S. Attorneys Carolyn Ferko and S. Mark McIntyre of the Southern District of Texas prosecuting the case along with Trial Attorney William Mackie from the National Security Division’s Counterintelligence and Export Control Section.