United States v. Derek Sing

• Court: Court of Appeals for the Ninth Circuit
• Decided: September 4, 2018
• Docket: 16-50221
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS SEP 4 2018 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA, No. 16-50221

Plaintiff-Appellee, D.C. No. 2:14-cr-00212-CAS-1 v.

DEREK WAI HUNG TAM SING, MEMORANDUM* AKA ceven1073, AKA chuckeven8,

Defendant-Appellant.

Appeal from the United States District Court for the Central District of California Christina A. Snyder, District Judge, Presiding

Argued and Submitted August 10, 2018 Pasadena, California

Before: CLIFTON and CHRISTEN, Circuit Judges, and RUFE,** District Judge.

Derek Sing appeals his conviction, after a bench trial, on four counts of

transmission and one count of possession of trade secrets belonging to his former

employer, Rogerson Kratos (“RK”), in violation of the Economic Espionage Act,

18 U.S.C. §1832(a)(2)-(a)(4). We have jurisdiction under 28 U.S.C. §1291, and

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The Honorable Cynthia M. Rufe, United States District Judge for the Eastern District of Pennsylvania, sitting by designation. we affirm.

1. The district court did not err in denying without prejudice Sing’s pre-

trial motion to dismiss the First Superseding Indictment as multiplicitous. The

court vacated the multiplicitous counts of Sing’s conviction immediately before

sentencing, and we have held that this is an adequate remedy for avoiding double

jeopardy. See United States v. Schales, 546 F.3d 965, 980-81 (9th Cir. 2008);

United States v. Matthews, 240 F.3d 806, 818 (9th Cir. 2000), aff’d in relevant part

on reh’g en banc, 278 F.3d 880 (9th Cir. 2002). The district court did not, as Sing

contends, “defer” a ruling without good cause in violation of Federal Rule of

Criminal Procedure 12(d), but rather decided, consistent with this Court’s

precedent, that pre-trial dismissal of the indictment was unnecessary because the

government would present the same evidence at trial regardless of the number of

counts. United States v. Nash, 115 F.3d 1431, 1438 (9th Cir. 1997).

Moreover, any error under Rule 12(d) would have been harmless. Sing

presented no support for his assertion that his trial strategy was materially impaired

by the need to challenge the economic value of all seven circuit board schematics

charged in the indictment instead of the five schematics on which his final

conviction was based.

2. There was no constructive amendment of the indictment at trial as

there is adequate “assur[ance]” in the record that Sing was convicted “based solely

2 on the conduct actually charged in the indictment.” United States v. Ward, 747

F.3d 1184, 1191 (9th Cir. 2014). Although the government presented evidence at

trial regarding the value of stolen information not charged in the indictment, the

district court’s Findings of Fact and Conclusions of Law made clear that the

verdict was based on the value of the circuit board schematics at issue in the

relevant counts.

3. The evidence at trial was sufficient to sustain Sing’s conviction.

Sing contends that the government failed to establish that each of the five

individual schematics for which he was convicted “derive[d] independent

economic value, actual or potential,” from being secret. 18 U.S.C. § 1839(3)(B).

However, a rational factfinder viewing the evidence in the light most favorable to

the prosecution reasonably could have concluded that the government met its

burden beyond a reasonable doubt. United States v. Temkin, 797 F.3d 682, 688

(9th Cir. 2015).

In particular, the government presented evidence that RK competed

successfully in a specialized industry by developing products that met the

specifications of its customers, the demands of extreme environments, and rigorous

conditions for regulatory certification, and that RK derived substantial revenue and

profits from the sale and repair of its products. Witnesses from RK testified to the

cost and manpower that the company devoted to developing its certified circuit

3 board schematics. Witnesses also testified that RK and its competitors took efforts

to maintain the secrecy of information concerning their products, particularly their

electronic schematics. There was additional evidence at trial, including statements

from Sing himself, that access to RK’s schematics had the potential to substantially

simplify the ordinarily impractical task of reverse-engineering the company’s

circuit boards. Sing’s own expert witness agreed that a schematic offers insight

into how a company has designed its product, and that the certification of RK’s

final schematics by the Federal Aviation Administration adds to their value.

While Sing contends that the schematics at issue contained outdated, flawed,

and incomplete information, the government was not required to show that each

schematic, standing alone, could be translated directly into commercially viable

products or services by a competitor. Rather, the appropriate inquiry in assessing

economic value is whether the schematics conferred a competitive advantage on

their owner, United States v. Chung, 659 F.3d 815, 826 (9th Cir. 2011), a burden

that can be satisfied through direct evidence of the contents of the information and

its impact on business operations or through circumstantial evidence of the

resources invested by the owner in the production of the information and the

precautions taken to protect the secrecy of the information. See RESTATEMENT

(THIRD) OF UNFAIR COMPETITION § 39 cmt. e (AM. LAW INST. 1995). Here, the

district court reasonably inferred from the evidence at trial that the information

4 contained in the charged schematics allowed RK to maintain a competitive

advantage in its industry that would have been lost if the information were

disclosed to others.

AFFIRMED.