Cyberespionage IP Theft May Soon Lead to Court

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By George R. Lynch

Dec. 4 — Within five years at least one large company will file a federal court complaint against another company that has received trade secrets via cyberespionage, Stewart Baker, former National Security Agency general counsel, predicted Dec. 4.

The online theft of intellectual property from companies continues to be a major international issue, Baker, who is now a partner at Steptoe & Johnson LLP in Washington, said at an American Bar Association Standing Committee on Law and National Security event.

There has been some progress, he said, noting the recent U.S. and China agreement to improve cooperation on cybercrime and China's announcement that it had arrested hackers it said were responsible for the hack of the U.S. Office of Personnel Management.

In September, Baker had expressed some skepticism about Chinese President Xi Jinping's pledge not to engage in commercial espionage, describing the deal as positive and a step in the right direction but saying that some of the trade secret theft may be carried out by freelancing Peoples' Liberation Army generals who sell these secrets to companies for personal enrichment.

Baker also praised the Obama Administration's aggressiveness in building an international norm, agreed to by all G20 countries, that denouncing cyberattacks aimed at intellectual property for commercial gain.. The U.S. ability to attribute cyberattacks and sanction companies that receive and profit from stolen trade secrets has also improved, Baker said.

In addition, he said, the new Trans-Pacific Partnership includes remedies for the cybertheft of trade secrets..

Congress continues to debate the Cybersecurity Information Sharing Act, which the Senate is reconciling with two House-passed bills from earlier in the year, and isn't expected to be completed until 2016.

The bill includes controversial language that would provide immunity to companies that share cyberthreat data with the government through a portal at the Department of Homeland Security, with one aim being able to more effectively preventing intellectual property theft.

Baker served as the first DHS assistant secretary for policy.

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