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Enforcement Edge
December 27, 2021

View from the Courtroom: The Lieber Conviction and What It Means for DOJ’s China Initiative

Enforcement Edge: Shining Light on Government Enforcement

Last week, a jury convicted famed chemist, nanotechnology pioneer, and Harvard University professor Charles Lieber for charges stemming from his relationship with a Chinese research program at the Wuhan University of Technology (WUT). The jury found Lieber guilty of making a false statement to the US Department of Defense (DOD) and causing a false statement to be made to the National Institutes of Health (NIH), both regarding his affiliation with China’s Thousand Talents Program (TTP). In addition to the false statement charges, the jury found Lieber guilty of failing to disclose the income he received from WUT on his federal tax returns and failing to report a Chinese bank account. This is a significant prosecution for the Department of Justice (DOJ), coming just three months after a setback for the China Initiative when University of Tennessee researcher Anming Hu was acquitted by the court on all charges after a jury trial ended in a mistrial.

The China Initiative was first announced by then-Attorney General Jeff Sessions in November 2018, with the objective of countering perceived Chinese national security threats. The Initiative is headed by the National Security Division and composed of partners from the DOJ Criminal Division and various US Attorney’s Offices. The Initiative’s webpage promotes numerous trade secrets, fraud, and espionage convictions that have been secured since its inception.

One of Arnold & Porter's  own watched the opening day of the Lieber trial at the Boston federal courthouse. The government’s case was straightforward: Lieber had an employment agreement with WUT and was affiliated with the TTP, but, when approached by federal investigators, he lied about that affiliation. The government’s case was strengthened by a post-arrest video of Lieber admitting to signing a TTP document, receiving money from WUT, having a foreign bank account, and not reporting his foreign income on his tax returns. 

The defense’s theory could be summarized by this line from its opening statement: “This is not a case about Charlie in China. It’s about careless actions in Cambridge.” Lieber’s defense to the allegation that he caused Harvard to make a false statement to the NIH attacked Harvard’s process of responding to the NIH’s inquiry. When Harvard originally received the inquiry, it began a review process that included interviewing Lieber. An attorney from Harvard’s Office of Sponsored Programs, the office responsible for handling grants applications, interviewed Lieber, and a member of the attorney’s staff took notes during that interview. The attorney drafted a memorandum summarizing the interview and then wrote the letter to the NIH based on that memorandum. Lieber’s defense criticized Harvard’s process, arguing that the letter “doctored” what Lieber actually said to the attorney and left out key context. However, the evidence at trial showed that Lieber also reviewed the letter before Harvard sent it to the NIH. Lieber’s defense to the allegation that he made a false statement to the DOD accused the investigators of asking questions that lacked clarity and pointed out how Lieber told investigators that he was not sure how WUT classified him.

Lieber did not mount an extensive defense to the financial charges. The defense team mentioned them in passing during opening statements, and its closing merely argued that the government failed to prove the exact amount that Lieber received from WUT and that there were no records of his receiving the funds. By contrast, the prosecution’s closing arguments relied heavily on Lieber’s post-arrest statement.

Lieber’s conviction provides a few takeaways for universities as DOJ continues to investigate professors with foreign financial ties, whether in connection with the China Initiative or other enforcement efforts:

  • Investigation Process: Professors charged in these cases may decide to attack the credibility of the university’s investigation and interview process following a government agency’s inquiry. As in the Lieber case, a defendant may probe any inconsistencies between what the defendant said to the university and what the university then reported to the government.
  • Substantive Review: Not only should a university consider how it reviews a professor who is alleged to have improper ties to China (or any other foreign country), but what it reviews as part of its investigation. Lieber’s defense criticized Harvard for only reviewing what it had on file and interviewing Lieber. A university in similar circumstances should consider thoroughly investigating a professor’s relationship with the Chinese (or other foreign) entity in question over time. This process could include confirming the dates and amounts of payments received, scrutinizing the details of the work performed, reviewing the email communications between the professor and the foreign entity in question, and reviewing the communications between the professor and others who may have knowledge of the relationship.
  • Grant Procedures: Although not a significant topic in the Lieber case, a future trial may spotlight the clarity of a university’s grant process and the training the professors receive about that process. Given DOJ’s ongoing attention to these issues, universities should consider reviewing their procedures and training to ensure that faculty and grants administrators are fully aware of federal agency requirements and that their internal reporting mechanisms are sufficient to meet those requirements.

That said, the Lieber conviction should be viewed more as an anomaly than a trend. The financial charges here made this case particularly strong when compared to other China Initiative prosecutions. Nonetheless, given this conviction, we expect to see more from the China Initiative. We will be following the Initiative’s actions here on Enforcement Edge. If you have questions, reach out to any of the authors or your other trusted Arnold & Porter contacts.

© Arnold & Porter Kaye Scholer LLP 2021 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.