A 22-year-old Canadian man was sentenced to 18 months in US federal prison after pleading guilty to stealing more than $100 million worth of intellectual property from Microsoft and other companies.
David Pokora of Ontario pled guilty to charges of criminal copyright infringement and conspiracy to commit computer intrusions.
Pokora was a member of a hacker group that called itself the Xbox Underground and stole software and data for Microsoft’s Xbox One and Xbox Live video game platforms.
The group also invaded the computer networks of Epic Games, Zombie Studios, and Valve Corp and took unreleased software, source code, trade secrets, and other proprietary information.
In 2011, the hackers stole the technical specs for the Xbox One and built and sold counterfeit copies.
Canada’s National Post called the hackers “surprisingly social” and noted that they chatted online via web-conferencing as they hacked into game company networks.
One of the hackers was secretly cooperating with law enforcement and turned over records of the online hacking sessions.
Pokora is the first foreign hacker to be convicted of the theft of US trade secrets, according to prosecutors. As we discussed, other non-US citizens have been convicted for theft of trade secrets via other methods.
The US has also seized about $620,000 from the defendants.
Three US citizens who were members of the ring – including a 19-year-old – also pled guilty.
The teen managed to steal 11,000 log-in credentials from just one target company. The group also hacked a US army network, stealing an Apache helicopter flight simulator.
The defendants faced penalties of up to five years in prison and fine of $250,000 or twice the amount of the defendant’s gain or their victims’ loss.
Leech Tishman IP attorney, Kenneth D’Alessandro says,
Under certain circumstances, criminal liability for trade secret misappropriation can attach to corporations and their management personnel, and clients should take extra precautions to avoid receiving information when hiring employees who are recently departed from competitors.
The case is USA v. Leroux et al.
As we have previously discussed, although trade secret theft is more commonly addressed via civil lawsuits, in some cases it can be prosecuted as a crime. Many companies now work with law enforcement when their intellectual assets have been stolen.