(Forbes.com, 7/17/08)

U.S. companies need to be increasingly careful about what they tell their Chinese engineers.Last August J. Reece Roth, an electrical engineering professor at the University of Tennessee, passed along a research paper to Sirous Nourgostar, a graduate student from Iran working under his supervision. It contained details on refined plasma actuator technology, which uses ionized gas to improve aircraft control. Roth was doing research on flight performance for a U.S. Air Force contractor and had relied on the assistance of Nourgostar and of Xin Dai, a Chinese national also studying under him.

That turned out to be a bad idea. In May Roth and the penny stock company he was working for were indicted by the federal government for violating an export control law that carries a maximum jail term of ten years. Roth’s business partner, Daniel Sherman, pleaded guilty and fingered Roth for giving Dai restricted data. Roth, who pleaded not guilty, got entangled in a little-known area of export law that is alarming big business and scientific researchers. It covers transfers of controlled technological information to foreigners on U.S. soil. The transfers are considered exports because they are “deemed” to be going to the country where the recipient is a citizen.

[1] http://www.forbes.com/global/2008/0721/042.html