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Justice News

Department of Justice
U.S. Attorney’s Office
Southern District of Texas

FOR IMMEDIATE RELEASE
Friday, February 15, 2019

Chinese National Sentenced for Selling Counterfeit Computer Parts

HOUSTON – A Beijing, China, man was sentenced to federal prison today for directing the shipment of counterfeit computer-networking equipment into the Southern District of Texas.

U.S. Attorney Ryan K. Patrick and Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division made the announcement.

U.S. District Judge Ewing Werlein Jr. sentenced Ruiyang Li, 40, to serve 54 months in federal prison. The court reserved the determination of restitution to the victims of Li’s trademark counterfeiting—including Cisco Systems Inc., The Hewlett-Packard Company and Intel Corporation—until a later date. Because Li is not a U.S. citizen, he is expected to face deportation proceedings after serving his prison sentence.

From at least 2007 until in or about June 2017, Li directed the shipment of counterfeit computer-networking equipment into the Southern District of Texas, first when selling to a retailer in Magnolia and eventually when selling to law enforcement acting in an undercover capacity. Over this time period, Li sold counterfeit networking products through several business entities, often hiding behind layers of personal and corporate aliases to evade law enforcement detection. Li also used various means to conceal his unlawful conduct, including by sending and receiving payments using accounts that did not appear connected, at least publicly, to companies trafficking in illicit products. Li and his customers would also agree to mislabel packages, break up shipments into separate components, alter destination addresses and use multiple forwarding companies based in the United States. These methods, in Li’s mind, made shipping counterfeit parts “safer,” which in practice meant delaying or complicating detection by U.S. authorities.

State and local governments rely on complex computer networking technology, including the transceivers and other parts that were trafficked in this case, to manage critical data and operations. This same technology is also prominent in banks, hospitals, air traffic control installations, power plants and other essential infrastructure. Because counterfeit parts are often not subject to stringent manufacturing requirements, they present a significant health and safety risk to communities across the United States.  

Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation with significant assistance from Customs and Border Protection. Assistant U.S. Attorney Jay Hileman and Senior Trial Attorney Timothy C. Flowers of the Computer Crime and Intellectual Property Section prosecuted the case.

Topic(s): 
Intellectual Property
Component(s): 
Updated February 15, 2019