What happened: Florida-based augmented reality (AR) unicorn Magic Leap has sued a former engineering employee and Chinese national for stealing technology used in its AR headset. Xu Chi left Magic Leap in 2016 and founded his own company in Beijing, known as Nreal, which unveiled an AR headset at a tradeshow in January, fewer than six months after Magic Leap’s device came to market. The Alibaba- and Google-backed company accused Xu of “neglecting his work duties” as he was stealing proprietary information and plotting to start his own firm. Magic Leap points to the fact that Xu’s company released a headset in less than two years, saying its own product was deployed after seven years of development and $2 billion of investment.
Why it’s important: Cases of trade secret theft have added to souring relations between the US and China. In April, the Justice Department indicted two Chinese nationals over alleged trade secret theft from General Electric. Washington claims that such incidents show China’s tech rise has boosted by appropriated technology. Chinese telecommunications giant Huawei has been also been accused of intellectual property theft. The company was indicted in January over allegations that they stole robotics technology. In May, a US chip startup also sued the Shenzhen-based telecoms operator over theft of trade secrets.