Significant Speeches

Remarks of the Honorable David J. Hickton
United States Attorney for the Western District of Pennsylvania
at the Press Conference Announcing U.S. Charges Against Five Chinese Military Hackers for Cyber Espionage

Robert F. Kennedy Department of Justice Building
Washington, D.C.
May 19, 2014

Pittsburgh has long been preeminent in the metals industry and home to organized labor.

Now, as a result, Pittsburgh has become a target of state-sponsored cyber intrusions.

The organizations targeted by the Chinese defendants are:

  • U.S. Steel, the largest steel company in the United States;
  • Westinghouse, one of the World’s leading developers of nuclear power technology;
  • ALCOA, the largest aluminum company in the United States;
  • Allegheny Technologies (ATI), a large integrated, specialty metals supplier headquartered in Pittsburgh;
  • The United Steelworkers International Union, the largest industrial union in North America; and
  • SolarWorld, a leading solar products manufacturing company.

These victims are tired of being raided. It is important for their government to take a stand against the criminals who infiltrate and exploit their computer networks.

Some of the malicious activity described in the Indictment appears designed to benefit the Chinese steel and metals industry in particular.

Domestic corporations struggle to compete with China on the pricing of steel and other goods. Our competitive advantage has been to engineer superior, stronger and more advanced products, such as oil country tubular goods (OCTG) and seamless standard line pipes (SSLP). These initiatives cost billions of dollars in capital, R and D. Computer intrusions enable the theft of technology and blunt our competitive edge.

At the time of these computer intrusions by the Chinese military, U.S. Steel, the Steelworkers, ATI and other companies were involved in trade disputes to redress “dumping” by China’s state-owned steel companies through accepted international dispute resolution mechanisms.

The success of these entities in trade litigation also made them targets. The hackers stole internal trade strategy, attorney-client communications, and costs and production analysis.

This conspiracy by Chinese hackers targeted each of these entities at significant times, such as in the midst of negotiations to build a nuclear power plant or on the eve of a trade case decision.

The effects of economic espionage attacks are far-reaching. Victim companies lose their capital investments in research and technology. But, cyber theft impacts real people in real and painful ways. The lifeblood of any organization is the people who work and strive and sweat for it. Production slows, plants close, workers get laid off, lose their homes. It happens in steel-towns like Braddock, McKeesport and Clairton, Pennsylvania, and many similar towns and cities in the United States.

This 21st century burglary has to stop. We would not stand idly by if someone pulled a tractor trailer up to a corporate headquarters, cracked the lock and loaded up sensitive information.

Hacking, spying and cyber theft for commercial advantage can and will be prosecuted criminally, even when the defendants are state actors. These victim organizations, and indeed every organization, are entitled to a fair shot and a level playing field in an intensely competitive global market.

We thank the FBI for its great work. It took world-class investigators to follow a complicated trail of computer evidence to one building, on one block, in one city in China.

We are ready to bring these defendants to justice in federal court in Pittsburgh, Pennsylvania.

Thank you.

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