There has been new progress in the case of trade secret infringement involving Haizheng Shengcai (688203).

　　HaiZheng Shengcai announced on the evening of March 13 that it had recently received a criminal judgment with accompanying civil damages issued by the People’s Court of Jiaojiang District, Taizhou City, Zhejiang Province. The judgment is as follows:

　　The defendant Zheng Moumou was convicted of the crime of infringing upon trade secrets and sentenced to three years and six months’ imprisonment, together with a fine of RMB 300,000; the defendant Qian Moumou was convicted of the same crime and sentenced to one year and six months’ imprisonment, together with a fine of RMB 150,000; the defendants Zheng Moumou and Qian Moumou, as well as the defendant Puli Si Biotechnology Co., Ltd. (hereinafter referred to as “Puli Si”), are hereby ordered to immediately cease all acts of infringing upon the trade secrets of the plaintiffs Haizheng Bio‑Materials and Zhejiang Hainoer Biomaterials Co., Ltd. (hereinafter referred to as “Hainoer Biomaterials”).

　　Meanwhile, Puli Si shall, within thirty days from the date this judgment takes effect, compensate Haizheng Biomaterials and Hainoer Biotechnology for their economic losses (including reasonable expenses incurred in protecting their rights) in the amount of RMB 4.85 million. Qian Moumou shall compensate Haizheng Biomaterials and Hainoer Biotechnology for their economic losses in the amount of RMB 150,000.

　　Earlier, in mid-December last year, Haizheng Shengcai announced that it had received a “Notice of Court Appearance” from the People’s Court of Jiaojiang District, Taizhou City. The case involves defendants Qian Moumou and Zheng Moumou, who are accused, along with plaintiffs Haizheng Shengcai and Hainoer Bio, as well as defendants Ke Moumou, Pliith, Anhui Jinpuri New Materials Co., Ltd. (hereinafter referred to as “Jinpuri”), and Zhangjiagang Walter Precision Machinery Co., Ltd. (hereinafter referred to as “Walter”), of the crime of infringing upon trade secrets, and is scheduled to go to trial soon.

　　In this case, the listed company has requested that the defendant immediately cease all acts infringing upon its trade secrets and jointly compensate the company for economic losses, currently estimated at RMB 30 million.

　　Among the parties involved, Hainoer Bio is a wholly owned subsidiary of Haizheng Biomaterials; Qian, a former employee of Walter; Zheng, an employee of Pliith; and Ke, an employee of Jinprui. Haizheng Biomaterials stated that, under the direction and assistance of Qian, Zheng and Ke donned Walter work uniforms and, by illicit means, gained unauthorized access to Hainoer Bio’s resin production workshop. Within the workshop, Zheng, Ke, and others separately conducted reconnaissance—through observation and photography—of certain production equipment, process flows, and operating parameters, while also stealing relevant auxiliary materials.

　　According to Qichacha, Pliith was established in May 2021 with a registered capital of RMB 426 million. The company’s official website states that it focuses on the research and development, production, sales, and technical services of bio-based materials, aiming to become a global leader in polylactic acid (PLA) materials. Jinpuri is a wholly owned subsidiary of Pliith.

　　Founded in 2014 with a registered capital of RMB 10 million, Walter is controlled by individual shareholder Cai Xiaofeng. The company provides automated material-handling equipment, smart‑factory solutions, and advanced materials‑related services. A reporter from Securities Times·eCompany called Cai Xiaofeng, who disclosed that Walter is a supplier to Haizheng Biomaterials.

　　According to HaiZheng Bio’s 2025 interim report, the company has established a fully integrated industrial production chain spanning “lactic acid–lactide–polylactic acid,” mastered key technologies across all stages from material synthesis to market applications, and achieved large-scale production and sales of polylactic acid.

　　Polylactic acid is a high‑molecular‑weight polymer formed by the dehydration condensation of lactic acid. It is widely regarded in the industry as having broad application prospects, and it is environmentally friendly, non‑toxic, and biodegradable.

　　According to Qichacha, Puli Si is held by eight shareholders, including Eighth Element Environment, Hefei Langrun Asset, Chen Xuesi, and the Changchun Institute of Applied Chemistry (hereinafter referred to as “Changchun Institute of Applied Chemistry”), among others. Reports indicate that the company has developed its technologies based on the “next-generation polylactic acid industrialization technology” of the Changchun Institute of Applied Chemistry of the Chinese Academy of Sciences (hereinafter referred to as “Changchun Institute of Applied Chemistry”), with an R&D team led by Academician Chen Xuesi.

　　The “seed technology” that Haizheng Shengcai pioneered is also closely linked to the Changchun Institute of Applied Chemistry.

　　In August 2004, Haizheng Biomaterials was established through joint investment by Haizheng Group, Changchun Institute of Applied Chemistry Technology (a wholly owned subsidiary of the Changchun Institute of Applied Chemistry), and Chen Xuesi. Among them, Haizheng Group, Changchun Institute of Applied Chemistry Technology, and Chen Xuesi each contributed a portion of their capital in the form of intangible assets—specifically, “polylactic acid biodegradable plastic technology.”

　　In February 2004, the Institute of Applied Chemistry, Changchun, issued a statement indicating that both the Institute and HaiZheng Group each hold a 50% ownership interest in the “polylactic acid biodegradable plastic technology.” With respect to the portion of this intangible asset owned by the Institute, 40% has been awarded to the technology inventor, Chen Xuesi.

　　Chen Xuesi was born in 1959. His research and development efforts primarily focus on biodegradable medical polymer materials, tissue engineering and drug‑controlled release, as well as the industrialization of polylactic acid and poly‑ε‑caprolactone. In 2019, Chen Xuesi was elected an academician of the Chinese Academy of Sciences.

　　Chen Xuesi briefly served as a director of Haizheng Bio‑Materials in 2020. At the time of Haizheng Bio‑Materials’ IPO in August 2022, he held 2.12 million shares, valued at approximately RMB 35.3616 million based on the issue price of RMB 16.68 per share.