The US State Department announced on Monday that it was imposing sanctions under the Protecting American Intellectual Property Act (PAIPA) on five Chinese entities suspected of stealing trade secrets from American companies. The targets include Shanghai Zhisuan Technology, founded by former Google software engineer Ding Linwei, venture capital firm MiraclePlus and three related entities. The five entities will face asset freezes and a ban on transactions with US individuals and entities. The measures also include restrictions on financial services and foreign-exchange licenses.
Ding founded Shanghai Zhisuan Technology in 2023. Shanghai Zhisuan claimed experience with Google's TPU Superpod, which clusters up to 9,600 chips into a single logical network. Shanghai Zhisuan explicitly said the company could replicate Google's superintelligence infrastructure technology. MiraclePlus provided seed funding in exchange for equity in Shanghai Zhisuan. MiraclePlus also gave Shanghai Zhisuan a platform to showcase the company and attract follow-on investment. The sanctions statement said Ding used the MiraclePlus platform to promote Ding's connection to Google technology and ability to replicate that technology for China's conditions.
The sanctions also target Beijing Qiji Chuangtan Phase I Venture Capital Centre Limited Partnership and Beijing Qiji Chuangtan Phase II Venture Capital Centre Limited Partnership. MiraclePlus manages both venture capital funds. The fifth target is Beijing Qiji Chuangtan Zhiyuan Enterprise Management Centre Limited Partnership, a corporate management entity wholly owned by the Phase I fund. The sanctions comprehensively cut off Ding's company and the capital network behind the company.
A federal jury in San Francisco convicted Ding in January this year on 14 counts, including seven economic espionage counts and seven trade secret theft counts. Federal District Judge Vince Chhabria overturned all seven economic espionage convictions in August while upholding the trade secret theft convictions. Chhabria found insufficient evidence that Ding knew or intended at the time of the thefts that Ding's conduct would benefit China's government. Ding was sentenced on September 1 to 12 months minus one day in prison. Ding was also ordered to pay about US$198,000 in restitution.
The original indictment alleged that Ding stole confidential code related to Google's AI supercomputing infrastructure. The code included technical details of tensor processing units, graphics processing unit systems and networking components used to train and deploy large-scale AI models. Ding joined Google in May 2019 as a software engineer. Ding mainly developed software for Google's supercomputing data centres, giving Ding access to Google's core technology assets.
A superseding indictment alleged that Ding secretly uploaded more than 1,000 unique Google files to Ding's personal cloud account from May 2022 to May 2023. The superseding indictment alleged that Ding secretly founded technology companies in China while employed at Google without notifying Google. The superseding indictment alleged that Ding promoted Ding's mastery of Google's computing platform technology to attract investment. The superseding indictment in February 2025 also said Ding applied to a talent programme in Shanghai. Ding's application material stated that Ding's product would help China achieve computing infrastructure capabilities on par with international standards.
Ding resigned from Google in late 2023 and booked a one-way ticket from San Francisco to Beijing. The FBI arrested Ding in March 2024.
The technology is strategically important to China's AI industry. High-performance chips are subject to export controls. Efficiently coordinating and scheduling thousands of chips for large-model training has become one of the biggest barriers to developing superintelligence. Google's software can significantly improve the utilisation efficiency of large computing clusters.
The companies did not immediately respond to a request for comment.
US Sanctions 5 Chinese Entities for AI Trade Secrets Theft by Ex-Google Engineer
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Summary
The US State Department imposed sanctions on five Chinese entities under PAIPA for allegedly stealing AI trade secrets from US firms. The list includes Shanghai Zhisuan Technology, founded by ex-Google engineer Ding Linwei, and VC firm MiraclePlus. Measures include asset freezes and transaction bans. Ding was previously jailed for 11 months for stealing Google’s AI infrastructure code, including details on tensor processing units. The move aligns with broader CFT efforts to target illicit financial flows. The crackdown could weigh on risk-on assets in the short term.
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