The State of Storage

Chinese memory-maker YMTC sues US rival Micron for defamation instead of the usual patent breaches

Alleges dirty PR campaign to slur its tech

China’s Yangtze Memory Technologies has accused rival chipmaker Micron of defamation through a campaign to publish nasty stories and reports about it.

The Chinese company (YMTC) recently filed a complaint [PDF] in US District Court that names Micron and public affairs firm DCI as plaintiffs, and alleges they ran a scheme that “seeks to destroy YMTC’s reputation and business by spreading xenophobic lies that YMTC’s market-leading flash memory chips are capable of being used to spy on millions of Americans who use the devices in which the chips are embedded, at the behest of the Chinese Communist Party or its People’s Liberation Army.”

YMTC’s complaint states that the claims are “are false and unlawful” – and that the defendants know it.

Some of the material YMTC objects to appeared on a website called “China Tech Threat” that does not include information about the identity of its publisher. WHOIS records for the site list domainsbyproxy.com as its registrar, and that outfit’s slogan is: “Your identity is nobody's business but ours.”

YMTC’s complaint alleges DCI runs China Tech Threat, and that Micron worked with the agency to post material there. One alleged product of that effort is a report titled “Silicon Sellout: How Apple’s Partnership with Chinese Military Chip Maker YMTC Threatens National Security” [PDF]. The site contains many more articles critical of YMTC.

The suit claims DCI has done this sort of thing before, and that Micron worked with the public affairs firm to tap its “astroturfing” expertise – PR-speak for faking grassroots opinions.

The Chinese company’s suit also alleges that Micron and DCI possess sufficient technical knowledge that they must know their claims that YMTC products spy on users are specious, because memory does not include the components necessary to exfiltrate data.

“YMTC would have absolutely no ability to manufacture a chip in such a way as to clandestinely utilize those parts of a mobile device without the device manufacturer knowing,” the complaint states.

That may well be true – hiding exfiltration circuitry in memory chips and finding ways to have them communicate with Chinese spies without leaving any trace, would be quite a feat!

However, governmental concerns about Chinese tech companies go beyond hardware - there's also the matter of China’s National Security law, which requires all Middle Kingdom companies to assist Beijing in matters of national security. Chinese legal analysts dispute the extent of the law’s power to compel co-operation from Chinese companies.

In addition, there's concern that large Chinese companies have Communist Party cadres whose members can report on their affairs. Sources have told your correspondent that intelligence agencies fear Beijing arranges for those Party members to take jobs in Chinese companies’ offshore operations so they can gather intelligence from their customers. Chinese networking companies, for example, know a lot about the disposition and location of their carrier customers’ critical kit. Gathering information about that doesn’t require tactics that would make the pages of a spy novel, because vendors have a perfectly reasonable excuse to visit their customers.

YMTC’s tech could therefore be entirely clean, but the people who install and maintain it could use access to customer sites to conduct some snooping.

In 2023, China banned some Micron products, citing unspecified flaws that Beijing never detailed.

Micron and YMTC have previously had legal fights over alleged breaches of patents. YMTC’s new suit claims its patents allow it to create products Micron still cannot match, and that the American memory-maker has resorted to defamatory tactics because its technology is not competitive.

The Register sought comment from Micron and DCI. Neither had responded at the time of writing. ®