United States v. Xiaorong You

RECOMMENDED FOR PUBLICATION

Pursuant to Sixth Circuit I.O.P. 32.1(b)

File Name: 23a0148p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

┐

UNITED STATES OF AMERICA,

│

Plaintiff-Appellee, │

> No. 22-5442

│

v. │

│

XIAORONG YOU aka Shannon You, │

Defendant-Appellant. │

┘

Appeal from the United States District Court for the Eastern District of Tennessee at Greeneville.

No. 2:19-cr-00014-1—J. Ronnie Greer, District Judge.

Argued: June 14, 2023

Decided and Filed: July 11, 2023

Before: BOGGS, GIBBONS, and McKEAGUE, Circuit Judges.

_________________

COUNSEL

ARGUED: John D. Cline, LAW OFFICE OF JOHN D. CLINE, Seattle, Washington, for

Appellant. Joseph Palmer, UNITED STATES DEPARTMENT OF JUSTICE, Washington,

D.C., for Appellee. ON BRIEF: John D. Cline, LAW OFFICE OF JOHN D. CLINE, Seattle,

Washington, Jason Liang LIANG LY LLP, Los Angeles, California, Brian A. Sun, NORTON

ROSE FULBRIGHT, Los Angeles, California, for Appellant. Joseph Palmer, UNITED

STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee.

_________________

OPINION

_________________

BOGGS, Circuit Judge. A jury convicted Xiaorong You, a chemical engineer, of stealing

trade secrets from her former employers. On appeal, You argues that the district court admitted

racist testimony that denied her a fair trial, gave jury instructions that mischaracterized the

No. 22-5442 United States v. You Page 2

government’s burden of proof as to You’s knowledge of the trade secrets and their value to

China, and, in calculating her sentence, both improperly considered and unreasonably calculated

the loss that she intended to cause.

We affirm You’s conviction, but vacate the sentence imposed and remand for

resentencing. The district court did not err in its evidentiary rulings, its jury instructions, or its

reliance on intended loss. However, in calculating the intended loss, the district court clearly

erred by relying on market estimates that it deemed speculative and by confusing anticipated

sales of You’s planned business with its anticipated profits.

BACKGROUND

I. Facts

In 2012, Dr. Xiaorong You, a foreign-born U.S. citizen of Chinese origin, began working

as a chemist for the Coca-Cola Company in Atlanta, Georgia. You’s job was to test the chemical

coatings used in Coca-Cola’s beverage cans. For decades, beverage-can coatings contained

bisphenol-A (“BPA”). However, Coca-Cola wanted to use safer “BPA-free” coatings. Six

chemical companies developed BPA-free formulas, then tried to sell them to Coca-Cola and

other beverage manufacturers.1 To protect their formulas, these companies entered into

nondisclosure agreements with Coca-Cola. You was one of only a few Coca-Cola employees

with access to these formulas.

While working for Coca-Cola, You planned to start a new company in China that would

manufacture the BPA-free chemical. Partnering with a Chinese chemical company, the Weihai

Jinhong Group (“WJG”), You applied for, and later received, business grants from the Chinese

government.2 In her application for a national grant through China’s Thousand Talents program,

You stated that she had developed the world’s “most advanced” BPA-free coating technology.

She claimed that this technology would enable her new company to “break the international

1The six companies were AkzoNobel, BASF, Dow Chemical, PPG Industries, Sherwin-Williams, and

ToyoChem.

2In addition to awarding You and WJG roughly $150,000, the national and province-level grants promised

to subsidize You’s salary for four years, reimburse moving expenses, set up a laboratory, provide research funds,

and arrange housing and a car.

No. 22-5442 United States v. You Page 3

monopoly” on BPA-free coatings, and ensure that international trade regulations on BPA would

not block Chinese exports. You’s application added that the new company would further the

government’s “Five Year Plan” and its “Made in 2025” initiative. You and WJG also received a

province-level grant from Shandong Province and the Chinese city of Weihai, to whom they had

made similar representations. Neither Coca-Cola nor You’s subsequent U.S. employer, Eastman

Chemical Company (“Eastman”), knew that You had received these grants or made these

representations.

On June 30, 2017, Coca-Cola informed You that she would be laid off in sixty days amid

company layoffs. You tried to transfer confidential files of the chemical companies’ BPA-free

formulas to a personal hard drive, but Coca-Cola’s network-security protocols blocked the

transfer. On her last night as a Coca-Cola employee, You successfully transferred these files to

her Google Drive account and then to a USB drive. You certified in her severance agreement

that she had not kept any confidential information.

You then joined Eastman in Tennessee. In June 2018, aware that she might lose her job,

You copied company files to the same Google Drive account and USB drive holding her Coca-

Cola files. Eastman fired You the next day. Eastman knew that You had downloaded company

information and asked her to return it. You returned her company laptop and cell phone, on

which Eastman found photos of its lab equipment. Eastman employees also accompanied You to

her home and retrieved the USB drive. Eastman later reported You to the Federal Bureau of

Investigation (“FBI”).

Over the next few months, You prepared to start her company in China. Between August

and September 2018, she flew to China twice. On both occasions, You escorted WJG

representatives and Weihai city officials to Italy, where they met with executives from Metlac,

an Italian chemical company. When You returned to the United States after one of these trips, in

September 2018, she was stopped at the airport and questioned. Law-enforcement agents seized

her computer, on which, after getting a warrant, they found confidential information belonging to

Eastman and the other chemical companies.

No. 22-5442 United States v. You Page 4

The FBI arrested You in February 2019. On You’s USB drive and Google Drive account,

agents found many of the same files that belonged to Eastman and the other companies.

Forensic analysts determined that, after her airport stop, You had renamed these files to remove

the names of the companies to whom this information belonged.

II. Procedural History

A grand jury in the Eastern District of Tennessee charged You with conspiracy to commit

theft of trade secrets, in violation of 18 U.S.C. § 1832(a)(5); seven counts of possessing stolen

trade secrets, in violation of 18 U.S.C. § 1832(a)(3); wire fraud, in violation of 18 U.S.C. § 1343;

conspiracy to commit economic espionage, in violation of 18 U.S.C. § 1831(a)(5); and economic

espionage, in violation of 18 U.S.C. § 1831(a)(3). After a thirteen-day trial in April 2021, a jury

convicted You on all counts.

A. Evidentiary Rulings

1. Barry Naughton

Before trial, the government notified You that it planned to offer expert testimony from

Dr. Barry Naughton, an economics professor at the University of California, San Diego, who

specializes in China’s economy. You moved to exclude Naughton’s testimony. The district

court held a mid-trial Daubert hearing and denied the motion. The court found that Naughton’s

testimony would help the jury understand the structure of China’s government, its “strategies of

foreign technology acquisition,” and the “role official talent programs play in those strategies.”

The court also found that the testimony’s probative value outweighed any risk of unfair prejudice

under Rule 403. The court explained that the testimony was probative of whether the alleged

offenses benefitted a foreign government and that nothing in Naughton’s testimony was unfairly

prejudicial.

At trial, Naughton described the “enormously high priority” that the Chinese government

placed on “technology acquisition,” including through grants such as its Thousand Talents

program. He explained that, while the Chinese government would “rather have legally acquired

technology,” it was also “interested in acquiring both legally or perhaps gray or even illegally

No. 22-5442 United States v. You Page 5

acquired technology in pursuit of [its] objectives.” Naughton testified that the “general points”

of this strategy were “common knowledge within China” because the government “talk[s] about

[it] all the time.” He explained that people in China were “proud . . . and I think legitimately so”

of “China’s ability to catch up to advanced countries.” When asked whether “scientists with ties

to China would be aware of this overall strategy,” Naughton agreed and said, “I think every

educated Chinese person is aware of this.”

Next, Naughton described China’s talent-grant programs. Naughton explained that

“bring[ing] technology to China that [the applicant] did not own” would not preclude a grant

award because “the attitude predominantly is China is catching up, the economic interests of the

collectivity of we Chinese people is much more important than the property rights of some

foreign company.”

2. Pier Bocchio

Before trial, the government moved to introduce the video-recorded deposition of Pier

Bocchio, Metlac’s CEO. In his deposition, Bocchio stated that You, together with Weihai city

officials, had traveled to Italy and tried unsuccessfully to convince Bocchio to partner with

You’s new company. The district court found the video admissible, but it excluded a brief

portion in which Bocchio, when asked why Metlac did not want a factory in China, explained

that “I didn’t trust the Chinese. Especially they are very well-known to steal the technology. It’s

possible.” The district court explained that, although the context showed that Bocchio “was

explaining why his company would not enter the market in China, the generalization of a

nationality or people as ‘untrustworthy’ could be interpreted as racially motivated.” The district

court found that the risk of unfair prejudice outweighed the statement’s probative value, and

ordered the statement edited out of the video for trial.

The government prepared an edited video clip, but mistakenly played the unedited video

at trial. When he realized that the excluded statement was playing, the prosecutor interrupted

and tried to keep the jury from hearing it. At a sidebar conference, the government

acknowledged its responsibility for the error and apologized.

No. 22-5442 United States v. You Page 6

The district court found that the statement had played in violation of the court’s order, but

denied You’s request for a mistrial. The court explained that it had excluded Bocchio’s

statement because it was concerned that “the race of the defendant was going to become an

issue.” In that context, Bocchio’s statement could have a “possible racial connotation” if he

were referring to “an individual person of Chinese descent” rather than to the Chinese

government. But having heard the evidence, the district court “no longer ha[d] that concern,”

and concluded that “under these circumstances [Bocchio is] talking about the Chinese

government.” The district court added that “to declare a mistrial” would be “inappropriate”

because “the harm is very, very slight.” The district court offered to instruct the jury to disregard

the statement, but defense counsel declined, to avoid drawing more attention to the statement.

B. Jury Instructions

In explaining the mens rea requirement for the counts of trade-secret theft, the district

court instructed the jury that the government was required to prove that You: (1) “knowingly

possessed information knowing that it was stolen or obtained or converted without authorization

from the owner”; (2) “knew the information was proprietary, meaning belonging to someone else

who has exclusive rights to it”; and (3) “intended to convert the information to the economic

benefit of herself or another, knowing or intending that this would injure the owner of the

information.” Drawing on United States v. Krumrei, 258 F.3d 535 (6th Cir. 2001), the court

clarified that “the government is not required to prove [that You] knew that all the information

met all of the legal requirements of a trade secret.” Rather, the government needed to prove only

that You “knew that the owner treated the information as a secret and [You] was taking the

information without authorization from the owner.” The court’s instructions on the economic-

espionage counts also required proof only that You knew that the information was proprietary.

For her economic-espionage counts, You asked the district court to instruct the jury that a

benefit to a foreign government or instrumentality is “more than a benefit that might flow simply

from doing business in that country.” The district court declined. The court explained that the

case on which You relied was “simply a situation where the defendant was doing business in the

foreign country.” The court noted that, by contrast, the evidence against You suggested

“considerable entanglement between the Weihai Jinhong Group and the Chinese government,”

No. 22-5442 United States v. You Page 7

indicating that the “alleged coconspirators . . . were relying on funding from the Chinese

government to get this new corporation up and running.” The district court concluded that the

proposed instruction was not appropriate in light of the evidence presented at trial.

C. Sentencing

After the jury convicted You on all counts, the district court sentenced her to 168 months

of imprisonment. Calculating the anticipated profits that You hoped to earn by using the stolen

information to capture the Chinese market for BPA-free can coatings, the district court estimated

that You intended to impose $121.8 million of loss on the victim companies. The district court

concluded that, in a market dominated by a few multinational companies, anticipated profits

were the “most reasonable measure of loss.” The court estimated that the Chinese market for can

coatings totaled $2.9 billion each year. Assuming that 60% of the can makers in that market

were Chinese state-owned companies that would buy from Chinese suppliers, and that only 1%

of sales in that market were for BPA-free coatings, the court estimated that You intended to steal

$17.4 million in sales from the victim companies each year. Estimating seven years of profit,

from 2021 to 2027, the district court calculated a sales total of $121.8 million, constituting You’s

intended loss. The district court acknowledged that its calculation rested on several

“assumptions,” including that the Chinese market for BPA-free coatings would remain fixed, that

You would absorb all sales in China from Chinese can makers, and that Chinese can makers

were now buying BPA-free coatings in China from the foreign companies.

The district court computed an offense level of 41, including a 24-level enhancement for

intended loss between $65 million and $150 million, and a criminal-history category of I. The

court calculated a Guidelines range of 324 to 405 months of imprisonment and varied downward

to impose You’s 168-month sentence.

DISCUSSION

On appeal, You argues that (1) Naughton’s and Bocchio’s testimony denied her a fair

trial; (2) the district court’s jury instructions misstated the intent requirements for economic

espionage and trade-secret theft; (3) the district court abused its discretion in rejecting her

proposed instruction on the economic-espionage counts; (4) these errors, taken together,

No. 22-5442 United States v. You Page 8

rendered her trial fundamentally unfair; and (5) her sentence rested on an improper and

unreasonable determination of intended loss. We address each challenge in turn.

I. Expert Testimony

You challenges two evidentiary rulings, arguing that the district court’s admission of

Naughton’s testimony and its denial of her mistrial motion after Bocchio’s testimony deprived

her of a fair trial. We decline to order a new trial because Naughton’s and Bocchio’s testimony

was not unfairly prejudicial.

A. Naughton’s Testimony

You first argues that the district court should have excluded Naughton’s testimony under

Federal Rules of Evidence 403 and 704(b). We review a district court’s decision to admit

evidence for abuse of discretion. United States v. Adams, 722 F.3d 788, 810 (6th Cir. 2013). A

district court abuses its discretion when it improperly applies the law, uses the wrong legal

standard, or relies on clearly erroneous findings of fact. United States v. Cleveland, 907 F.3d

423, 436 (6th Cir. 2018). However, when a party fails to object to an evidentiary issue at trial,

we review it for plain error. United States v. Collins, 799 F.3d 554, 574 (6th Cir. 2015). You

objected to Naughton’s testimony under Rule 403, but not under Rule 704(b). Under plain-error

review, we may correct the claimed 704(b) mistake only if You shows (1) an error; (2) that was

clear or obvious; (3) that affected her substantial rights; and (4) that affected the fairness,

integrity, or public reputation of the proceedings. United States v. Jones, 108 F.3d 668, 670 (6th

Cir. 1997).

1. Rule 403

Rule 403 allows the district court to exclude evidence if its probative value is

substantially outweighed by the risk of unfair prejudice. We “afford[] great deference” to the

district court’s Rule 403 balancing, Cleveland, 907 F.3d at 436 (quoting United States v. Bell,

516 F.3d 432, 445 (6th Cir. 2008)), “giv[ing] the evidence its maximum reasonable probative

force and its minimum reasonable prejudicial value,” ibid. (quoting United States v. Wheaton,

517 F.3d 350, 364 (6th Cir. 2008)).

No. 22-5442 United States v. You Page 9

The district court did not abuse its discretion in admitting Naughton’s proposed testimony

under Rule 403. As the court noted, Naughton’s testimony addressed China’s strategy for

acquiring foreign technology and the role that Chinese businesses play in that strategy.

Naughton’s statements that scientists in China generally know about, and approve of, China’s

emphasis on technology acquisition were helpful in detailing the connection between You’s

Thousand Talents application and her plan to benefit the Chinese government by bringing secret

formulas to her new company. To the extent that Naughton’s testimony was prejudicial to You,

the district court added that You had not pinpointed any specific parts of Naughton’s proposed

testimony that were unfairly prejudicial.

On appeal, You mainly argues that Naughton’s testimony, together with Bocchio’s,

denied You a fair trial. However, the district court admitted Naughton’s proposed testimony

before trial under Rule 403. You’s claim that Naughton’s actual testimony deprived her of a fair

trial raises a different constitutional challenge, which we address below. McCleskey v. Kemp,

481 U.S. 279, 309 n.30 (1987) (“The Constitution prohibits racially biased prosecutorial

arguments.”); United States v. Cabrera, 222 F.3d 590, 594 (9th Cir. 2000) (“Appeals to racial,

ethnic, or religious prejudice during the course of a trial violate a defendant’s Fifth Amendment

right to a fair trial.”).

2. Rule 704(b)

Under Rule 704, Naughton “must not state an opinion about whether [You] did or did not

have a mental state or condition that constitutes an element of the crime charged,” Fed. R. Evid.

704(b), since ultimate issues are “matters for the trier of fact alone,” id. 704(a). Expert witnesses

cannot “actually refer[] to the intent of the defendant,” but they may “simply describe[] in

general terms the common practices of those who clearly do possess the requisite intent, leaving

unstated the inference that the defendant . . . also possessed the requisite intent.” United States v.

Combs, 369 F.3d 925, 940 (6th Cir. 2004) (quoting United States v. Frost, 125 F.3d 346, 383–84

(6th Cir. 1997)).

You argues that Naughton’s testimony “did exactly what Rule 704(b) prohibits” by

attributing to “every educated Chinese person” the knowledge that China seeks illegally acquired

No. 22-5442 United States v. You Page 10

technology. You adds that Naughton spoke to You’s mindset by describing approval of the

Chinese government’s approach to foreign-technology acquisition as the “predominant[]” view

among “technology policy experts” in China. But Naughton’s opinions—that educated people in

China are generally aware of China’s approach to foreign-technology acquisition, and that

technical experts in China “predominantly” valued China’s economic interests more than foreign

companies’ property rights—do not say anything directly about You’s thoughts on these topics.

Even if they did, You’s awareness of China’s strategy and her attitude toward China’s interests

are not elements of the crimes with which she was charged. See 18 U.S.C. §§ 1831–32. It does

not necessarily follow from this testimony, if credited, that You intended to benefit a foreign

government or instrumentality. To so conclude requires an additional “unstated” inference that

Naughton left for the jury. Combs, 369 F.3d at 940 (citation omitted). Especially under plain-

error review, Naughton’s testimony did not violate Rule 704(b).

B. Bocchio’s Video Deposition

You also suggests that the district court erred in denying a mistrial after Bocchio’s

statement that he “didn’t trust the Chinese” was played for the jury. We review the district

court’s decision to deny You’s motion for a mistrial for abuse of discretion. United States v.

Wandahsega, 924 F.3d 868, 878 (6th Cir. 2019).

The district court did not abuse its discretion in denying a mistrial. First, the record shows

that the government played Bocchio’s statement unintentionally and not in bad faith. Second, the

district court offered to give the jury a limiting instruction on Bocchio’s statement, which You

declined. You’s decision not to accept a curative instruction “undercuts [her] argument that the

comments compromised the integrity of the trial.” United States v. Wimbley, 553 F.3d 455, 460

(6th Cir. 2009). Third, the court did not err in reasoning that any resulting prejudice was “very,

very slight.” The court explained that Bocchio’s statement was best understood to mean that he

did not trust the Chinese government to protect his company’s intellectual property, not that he

did not trust Chinese people. The context of the question that Bocchio was answering, and of his

references throughout the deposition to his interactions with Chinese government officials,

confirms the court’s reading.

No. 22-5442 United States v. You Page 11

You rejects this reading as implausible. She argues that Bocchio’s reference to the

“Chinese” and his statement that “they” are known to steal foreign technology could only have

been meant to refer to Chinese people, including You. Rather than dealing in grammatical

absolutes when parsing witness testimony, we are better guided by the context in which the

statement was made. Moreover, You’s contention that the district court excluded the statement in

its pretrial ruling but “change[d] its view” at trial does not undermine the court’s ultimate

conclusion—after seeing the video deposition, the prosecutor’s interruption, and the jury’s

reaction—that the statement had hardly any prejudicial effect. In sum, Bocchio’s statement was

not so prejudicial that it was unfair for the court to continue the trial. See United States v. Young,

347 F. App’x 182, 189 (6th Cir. 2009) (affirming denial of mistrial where defendant declined

offer of limiting instruction, government did not act in bad faith, and improper remark was “only

a small part of the evidence against the defendant”). The district court did not abuse its discretion

in denying the motion for a mistrial.

C. Appeals to Racial Prejudice

More broadly, You asserts that Naughton’s and Bocchio’s statements denied her a fair

trial because they appealed to racial prejudice. Naughton’s and Bocchio’s testimony, according

to You, “invited the jury to distrust [her] by invoking an ethnic, national stereotype.”

Appeals to racial or ethnic prejudice violate a defendant’s Fifth Amendment right to a fair

trial. See McCleskey, 481 U.S. at 309 n.30. Where such appeals may have “substantial[ly]

influence[d]” the outcome of a trial, a new trial is needed. United States v. Grey, 422 F.2d 1043,

1046 (6th Cir. 1970).

As discussed above, neither Naughton’s nor Bocchio’s testimony appealed to racial

prejudice. In admitting Naughton’s testimony, the district court noted that the testimony was not

unfairly prejudicial and did not nudge the jury to decide You’s case on any improper basis.

Naughton’s testimony supported a theory of prosecution that focused on You’s individual

conduct. By testifying that scientists in China generally knew about, and approved of, certain

practices of the Chinese government, Naughton suggested, without appealing to racial or ethnic

stereotypes, that You intended to benefit that government. Similarly, the jury likely interpreted

No. 22-5442 United States v. You Page 12

Bocchio’s statement as suggesting that he distrusted the Chinese government, not that he

distrusted You as a person of Chinese origin.

You argues that we must consider the broader context of her trial, held shortly after the

COVID-19 pandemic had peaked and at a time when many blamed China and the Chinese for

the virus’s spread. Naughton and Bocchio, she claims, “poisoned a trial that occurred in an

already poisonous atmosphere.” You may be right that the COVID-19 pandemic “required

special care that anti-Chinese bias did not infect” her trial. However, the record shows that the

district court was sufficiently careful. For example, the court acknowledged the COVID-19

virus’s origin in China and the recent spike of anti-Asian hate crimes in America when it

excluded as unfairly prejudicial the testimony from a different government witness. For each

witness, the district court considered the testimony’s capacity to evoke an improper emotional

response from the jury. At all times, the district court ensured that You was being tried for her

crimes, not for her status as a person of Chinese ethnicity.

The cases on which You relies do not bolster her claim that the prosecution appealed to

racial prejudice. In United States v. Cabrera, 222 F.3d 590 (9th Cir. 2000), a police officer

repeatedly referenced Cubans in his testimony to suggest their propensity for drug dealing. Id. at

592. These comments had the “effect of putting the . . . Cuban community on trial, rather than

sticking to the facts” of the individual defendants’ conduct. Id. at 596. By contrast, the

challenged testimony in this case described practices of the Chinese government. References to

the “attitude” of educated Chinese professionals toward those practices were made only as

necessary to connect You’s grant applications with her intent to benefit the government. You’s

other cases similarly featured testimony that invited the jury to distrust the defendants based on

their national origin. See United States v. Vue, 13 F.3d 1206, 1211–13 (8th Cir. 1994) (reversing

convictions because of testimony discussing the involvement in drug smuggling of persons of

Hmong descent); United States v. Rodriguez Cortes, 949 F.2d 532, 541–42 (1st Cir. 1991)

(reversing admission of evidence of defendant’s Colombian ethnicity that prosecution had used

to suggest that he was likely to be associated with other Colombian conspirators); United States

v. Doe, 903 F.2d 16, 18–28 (D.C. Cir. 1990) (reversing conviction where prosecutor had

emphasized defendant’s Jamaican ancestry). The government’s case against You focused on her

No. 22-5442 United States v. You Page 13

individual conduct. It did not invite the jury to put her “racial and cultural background into the

balance in determining [her] guilt.” Vue, 13 F.3d at 1213.

II. Jury Instructions

A. Mens Rea Requirements

You challenges the district court’s jury instructions because they did not require proof

that she knew that the information she stole met all of the legal requirements of a “trade secret.”

Although the instructions required proof that You knew that the information was proprietary and

that You took the information without permission, You contends that the instructions were

insufficient because they failed to require proof that she knew that (1) the owners had taken

“reasonable measures” to protect the information; and (2) the information was valuable, in part,

because it was secret.

Although erroneous jury instructions are generally reviewed for abuse of discretion, we

review their “legal accuracy” de novo. Hurt v. Com. Energy, Inc., 973 F.3d 509, 523 (6th Cir.

2020) (quoting United States v. Blanchard, 618 F.3d 562, 571 (6th Cir. 2010)). We review

unpreserved objections to jury instructions for plain error. United States v. Houston, 792 F.3d

663, 666 (6th Cir. 2015). You seeks de novo review. The government seeks plain-error review,

claiming that You failed to preserve her claim.

1. No Plain Error

You challenges the jury instruction on a ground that she did not raise below, subjecting it

to plain-error review. To preserve an error in the jury instructions, You “must inform the court

of the specific objection and the grounds for the objection.” Fed. R. Crim. P. 30(d). Below, You

objected to a proposed jury instruction’s use of “proprietary,” which she thought “expand[ed] the

Sixth Circuit’s definition.” When the district court suggested an instruction that removed the

word “proprietary” but still required only “that the defendant knew the information belonged to

someone else who had exclusive rights to it,” You agreed that the court’s suggestion “probably

answers our objection.” On appeal, however, You argues that the district court should not have

No. 22-5442 United States v. You Page 14

relied on the underlying Krumrei decision from which the district court derived its “proprietary”

instruction.3

You had objected to the district court’s instruction to the extent that it improperly

expanded on Krumrei, but she ultimately conceded Krumrei’s relevance, which she cannot now

dispute. See United States v. Williams, 612 F.3d 500, 507 (6th Cir. 2010). You points to

instances in the record where she asked that the instruction require that You knew or believed

that the stolen information was a trade secret. As we discuss below, this argument does not

address what the government must prove to establish that knowledge. You’s argument, on

appeal, that the jury had to find that she knew that the stolen information satisfied each element

of the statutory definition of trade secret is a point that she did not make below. Accordingly, we

review this instruction for plain error. Houston, 792 F.3d at 666.

Under that standard, You cannot show that the alleged error in the jury instructions

affected her substantial rights. An error affects a defendant’s substantial rights when it “creates a

‘reasonable probability’ that the flawed . . . jury instruction led to a flawed conviction.” United

States v. Henry, 797 F.3d 371, 375 (6th Cir. 2015) (quoting United States v. Marcus, 560 U.S.

258, 262 (2010)). The evidence supports a finding that, even with a correct instruction, the jury

would have found that You had the necessary knowledge.

First, the evidence suggests that You knew of the “reasonable measures” that the

companies took to protect their information. You certified in her severance agreement with

Coca-Cola that she had not kept confidential information. She also knew of Coca-Cola’s efforts

to prevent unauthorized downloads of confidential information, because those security protocols

had blocked her own attempts to download confidential files. Likewise, she knew of Eastman’s

similar efforts when Eastman learned that she had downloaded its files and accompanied her to

her house to retrieve her hard drive. The jury instructions required the jury to find that You

3In Krumrei, the defendant challenged as unconstitutionally vague the EEA’s definition of “trade secret,”

particularly its “reasonable measures” requirement. 258 F.3d at 538. The court rejected that claim, holding that “the

defendant need not have been aware of particular security measures taken” by the owner. Id. at 539. Rather, it was

enough that he knew that the information was “proprietary,” meaning “confidential information to which he had no

claim.” Ibid.

No. 22-5442 United States v. You Page 15

knew “that the owner treated the information as a secret,” which effectively required her to know

about “reasonable measures” because You’s awareness of the latter is how she knew the former.

Second, the evidence also suggests that You knew that this information was valuable

because it was secret. In her Thousand Talents application, You emphasized the value of the

information as the world’s “most advanced” BPA-free coating technology, and claimed that it

would help “break the international monopoly” on BPA-free coatings. You’s plan to start a new

company in China would work only if the technology that she brought with her was both

valuable and secret. You could not intend to “convert the information” to her own economic

benefit, “knowing . . . that this would injure the owner,” as the court instructed the jury, if she

did not also believe that this information derived “independent economic value” from its secrecy.

You responds that this alleged error tainted her conviction because she “hotly contested”

at trial that the stolen information constituted trade secrets. Citing testimony from one of her

expert witnesses, You claims that this dispute raised doubt as to whether she knew that the

information constituted trade secrets. But You’s witness spoke only to whether the information

was in fact, by legal definition, a trade secret, offering an opinion that the jury rejected by

convicting You on every count, including those that required proof that the information was a

trade secret. The district court’s jury instruction was not so plainly erroneous as to warrant

reversal.

2. No Error

Even under de novo review, the challenged jury instructions were correct. The EEA

punishes for economic espionage anyone who, “intending or knowing that the offense will

benefit any foreign government, foreign instrumentality, or foreign agent, knowingly

. . . receives, buys, or possesses a trade secret, knowing the same to have been stolen or

appropriated, obtained, or converted without authorization.” 18 U.S.C. § 1831(a)(3).

The EEA also punishes:

(a) Whoever, with intent to convert a trade secret, that is related to a product or

service used in or intended for use in interstate or foreign commerce, to the

economic benefit of anyone other than the owner thereof, and intending or

knowing that the offense will, injure any owner of that trade secret, knowingly—

No. 22-5442 United States v. You Page 16

…

(3) receives, buys, or possesses such information, knowing the same to have been

stolen or appropriated, obtained, or converted without authorization.

Id. §1832(a)(3).

Information is a “trade secret” only if its owner has taken “reasonable measures” to keep

it secret and the “information derives independent economic value, actual or potential, from not

being generally known to, and not being readily ascertainable through proper means by[] another

person.” 18 U.S.C. § 1839(3).

The district court correctly instructed the jury on the mens rea requirements for You’s

counts of economic espionage and trade-secret theft. The jury did not need to find that You

knew that the information met each element in the EEA’s definition of a “trade secret.” It was

enough for the jury to find that You knew that she was taking “confidential information to which

[s]he had no claim.” Krumrei, 258 F.3d at 539.

You argues that the district court’s instruction omitted “from what [she] had to know the

two most salient features of a trade secret,” namely that the owner took reasonable measures to

keep its information secret and that the information derives value from its secrecy. However, it

is worth stressing that the court’s instruction did nothing to water down the meaning of “trade

secret” as defined in 18 U.S.C. § 1839(3) or that definition’s relevance to You’s conviction. In a

separate instruction, the district court asked the jury to find whether the stolen information were

trade secrets. In drawing on Krumrei, the district court did not rewrite the trade-secret definition

but rather detailed precisely what You needed to know about the stolen information to bring her

conduct within §§ 1831–32. As to that requirement, it was enough to show that You knew that

she was taking the companies’ confidential information without their permission.

You contends that Krumrei does not govern this case. There, the defendant challenged as

unconstitutionally vague the EEA’s definition of “trade secret,” particularly its “reasonable

measures” requirement. Krumrei, 258 F.3d at 538. “Regardless of his knowledge of those

specific measures,” the defendant “knew that the information was proprietary”—which, for this

court, was enough for him to know “that his actions fell well within” the bounds of the EEA. Id.

No. 22-5442 United States v. You Page 17

at 539. In addressing vagueness, this court established what intent was needed to violate the

statute. Just as the Krumrei defendant did not need “notice of any of the security measures taken

by” the trade-secret owner, id. at 538, You did not need to know the technical particulars of the

stolen information to know enough for a conviction under the EEA. Knowing that the

information was proprietary was enough for a conviction, even if the jury did not expressly find

that You knew the value of keeping this information secret or the specific measures used to

protect it.

You argues that the EEA’s plain language requires the government to prove that she

knew that the companies’ stolen files were trade secrets. Read in isolation, certain clauses in the

EEA might support that reading. See 18 U.S.C. § 1831(a)(3) (punishing a person who

“knowingly . . . receives, buys, or possesses a trade secret”); id. § 1832(a)(3) (punishing a person

who “with intent to convert a trade secret . . . knowingly . . . receives, buys, or possesses such

information”). However, the statutory text sandwiches “knowingly” between other clauses, each

with its own mens rea requirement. See id. § 1831 (“Whoever, intending or knowing that the

offense will benefit any foreign government [or] foreign instrumentality . . . knowingly possesses

a trade secret, knowing the same to have been stolen . . . without authorization . . . .”) (emphases

added); id. § 1832(a)(3) (“Whoever, with intent to convert a trade secret . . . to the benefit of

anyone other than the owner thereof, and intending or knowing that the offense will injure any

owner . . . knowingly possesses such information, knowing the same to have been stolen . . .

without authorization . . . .”) (emphases added). That additional language sets out the same

intent requirements on which the district court instructed the jury, namely that the defendant

must know that she is taking confidential information without authorization. It also provides

context on what “knowingly” modifies in §§ 1831 and 1832. It does not follow, for example,

that the word “knowingly” extends to § 1839’s statutory definition of a trade secret. Nothing

about the “ordinary meaning” of the statute’s text or the “ordinary interpretive practice” of its

words suggests that Congress used the word “knowingly” to refer to an additional set of elements

in a different part of the EEA, especially where Congress had included other mens rea clauses.

Flores-Figueroa v. United States, 556 U.S. 646, 657 (2009); cf. United States v. X-Citement

Video, Inc., 513 U.S. 64, 68 (1994) (noting that the “most natural grammatical reading” of a

No. 22-5442 United States v. You Page 18

statute would not understand the term “knowingly” to modify elements “set forth in independent

clauses separated by interruptive punctuation”).

To support her interpretation, You relies on three recent Supreme Court decisions. In

each case, the Court interpreted a different criminal statute “that introduces the elements of a

crime with the word ‘knowingly’” and applied that word to each element of the crime in the

statutory clause. Flores-Figueroa, 556 U.S. at 652; see Ruan v. United States, 142 S. Ct. 2370,

2374–75 (2022); Rehaif v. United States, 139 S. Ct. 2191, 2194 (2019). These cases are

instructive to the extent that they suggest what the EEA’s “knowingly” clauses might require if

read in isolation. See Flores-Figueroa, 556 U.S. at 650 (noting that “knowingly” modifies not

only the statute’s “transitive verb[s]” but also the object of those verbs). However, they “express

no view . . . about what precisely the Government must prove to establish” her knowledge with

respect to other statutory clauses, Rehaif, 139 S. Ct. at 2200, where the object or category in

question “involves complicated legal issues,” id. at 2207 (Alito, J., dissenting). The issue in this

case is over how specific You’s knowledge must be for a complicated statute with multiple mens

rea clauses, concerning a complex concept of intellectual property. Knowing that the stolen

information is proprietary is enough. Krumrei, 258 F.3d at 539. Knowing the facts that

technically make the information a trade secret, as the district court put it, “puts a higher burden

on the government than the law requires.”

The presumption of scienter also suggests that these cases cannot bear the weight that

You gives them. That presumption “requires a court to read into a statute only that mens rea

which is necessary to separate wrongful conduct from ‘otherwise innocent conduct.’” Carter v.

United States, 530 U.S. 255, 269 (2000) (quoting X-Citement, 513 U.S. at 72). In Flores-

Figueroa, Ruan, and Rehaif, the Court applied “knowingly” to statutory clauses that “play[ed] a

critical role in separating a defendant’s wrongful from innocent conduct.” Ruan, 142 S. Ct. at

2379; see Rehaif, 139 S. Ct. at 2195; Flores-Figueroa, 556 U.S. at 656–57. As discussed above,

the text in §§ 1831 and 1832 includes several other mens rea requirements. Reading the word

“knowingly” to modify each definitional element of “trade secret” would do little, then, to

“advance the purpose of scienter,” Rehaif, 139 S. Ct. at 2197, by “separat[ing] those who

understand the wrongful nature of their act from those who do not,” id. at 2196 (quoting

No. 22-5442 United States v. You Page 19

X-Citement, 513 U.S. at 72 n.3). A defendant who knowingly takes, without permission,

confidential property that belongs to someone else, knowing that her act will injure the owner or

benefit a foreign government, cannot reasonably claim that she acted innocently. It is true, as

You notes, that she cannot be convicted under §§ 1831 and 1832 unless the information at issue

is in fact a trade secret. But the statutes’ overall structure assures us that we do not risk

criminalizing otherwise lawful conduct by declining to extend the requirement of knowledge to

each element of § 1839(3).

Finally, You’s interpretation clashes with Congress’s purpose in enacting the EEA.

Consider, for example, a hacker who knowingly keeps ill-gotten confidential information. That

hacker might not know of certain measures that a company uses to protect its secrets, or of the

value derived from the information’s secrecy, but we would hardly doubt that he knows enough

to satisfy the statute’s mens rea element. Yet You’s interpretation would create a loophole for

those who knowingly retain confidential information that they obtained without permission, and

which they know they should not have. It would not have made sense for Congress to

criminalize economic espionage and trade-secret theft but exempt those defendants who know

that they have taken proprietary information without permission yet lack knowledge of the legal

definition of a trade secret or whether the information happens to meet each element of that

definition. See United States v. Feola, 420 U.S. 671, 678 (1975) (declining to require proof that

a defendant knew the victim’s status as a federal officer because such a requirement would

frustrate Congress’s purpose of protecting officers).

B. Proposed “Benefit” Instruction

You argues that the district court abused its discretion by refusing to instruct the jury that

proof of her intent to “benefit” a foreign government or instrumentality required “more than a

benefit that might flow simply from doing business in that country.” We review a district court’s

decision not to give proposed jury instructions for abuse of discretion. United States v. LaVictor,

848 F.3d 428, 453–54 (6th Cir. 2017). The refusal to give requested instructions constitutes

reversible error only if (1) the instructions correctly state the law; (2) the instructions are not

substantially covered by other instructions given to the jury; and (3) the failure to give the

instructions impairs the defendant’s theory of the case. Id. at 454.

No. 22-5442 United States v. You Page 20

The district court’s refusal to give You’s “benefit” instruction did not impair You’s

defense, which was based on the idea that You’s new company was not a foreign instrumentality.

See 18 U.S.C. § 1831(a). A “foreign instrumentality” includes “any . . . business organization,

corporation, firm, or entity that is substantially owned, controlled, sponsored, commanded,

managed, or dominated by a foreign government.” Id. § 1839(1). You’s joint venture with WJG

was not merely a private company but a “foreign instrumentality,” substantially “controlled” and

“sponsored” by the Chinese government. Ibid. You applied for, and received, funding from the

Chinese government to jumpstart her new company. Weihai city officials also accompanied You

and WJG on their trips to Italy “in pursuit of national objectives” to “open up the Chinese

market” and “develop Chinese industry.” As the district court noted when it rejected You’s

proposed instruction, this evidence showed “considerable entanglement between [WJG] and the

Chinese government.”

You rejects her company’s classification as a foreign instrumentality, and claims that her

defense was impaired because the government referenced only minor benefits to the Chinese

government, such as potential tax revenue from You’s new company. Even accepting You’s

argument that her venture was no instrumentality and that tax revenues were not a sufficient

benefit, the evidence reveals other benefits—beyond the perks of doing business—that You

intended to confer on the Chinese government. You claimed in her grant applications, for

example, that her company would further the government’s strategic initiatives and help Chinese

exports avoid violating international trade regulations. The jury would have reached the same

verdict on You’s espionage counts with her proposed instruction.

III. Cumulative Error

You contends that the errors alleged above, taken together, were so prejudicial as to

require a new trial. To prevail under cumulative-error analysis, You “must show that the

combined effect of individually harmless errors was so prejudicial as to render [her] trial

fundamentally unfair.” United States v. Underwood, 859 F.3d 386, 395 (6th Cir. 2017) (quoting

United States v. Warman, 578 F.3d 320, 349 n.4 (6th Cir. 2009)). However, “the accumulation

of non-errors cannot collectively amount to a violation of due process.” Ibid. (quoting Campbell

v. United States, 364 F.3d 727, 736 (6th Cir. 2004)). As discussed above, the district court

No. 22-5442 United States v. You Page 21

committed no errors with the government’s expert-witness testimony or its own jury instructions.

Even if You could show an error, plain or otherwise, she cannot show that it deprived her of due

process.

IV. Sentencing

Finally, You argues that the district erred in relying on the Guidelines commentary on

intended loss to enhance her sentence under U.S.S.G. § 2B1.1. And to the extent that the district

court could consider intended loss to enhance her sentence, You argues that the district court

clearly erred in determining it.

A. Relying on Intended Loss

Whether the district court erred in relying on the Guidelines commentary to calculate a

defendant’s Guidelines range presents a legal question that we review de novo. See United

States v. Riccardi, 989 F.3d 476, 481 (6th Cir. 2021).

For theft and fraud offenses, the Guidelines instruct courts to increase a defendant’s

Guidelines offense level “in incremental amounts based on the ‘loss’ from the offense.” Ibid.

(quoting U.S.S.G. § 2B1.1(b)(1)). Section 2B1.1, however, does not define “loss.” The

Sentencing Commission’s Guidelines commentary explains that, generally, loss is the “greater of

actual loss or intended loss.” U.S.S.G. § 2B1.1 cmt. n.3(A). The commentary defines “actual

loss” as the “reasonably foreseeable pecuniary harm that resulted from the offense,” id. § 2B1.1

cmt. n.3(A)(i), and “intended loss” as “the pecuniary harm that the defendant purposely sought to

inflict,” id. § 2B1.1 cmt. n.3(A)(ii).

When “determining whether to defer to the Guidelines commentary,” we apply the

framework set forth in Kisor v. Wilkie, 139 S. Ct. 2400 (2019). United States v. Phillips, 54

F.4th 374, 379 (6th Cir. 2022). In Kisor, the Court clarified when we must defer to an agency’s

interpretation of its own regulations. First, the regulation must be “genuinely ambiguous” after

we “exhaust all the ‘traditional tools’ of construction,” including analyzing the regulation’s “text,

structure, history, and purpose.” Kisor, 139 S. Ct. at 2415 (quoting Chevron U.S.A. Inc. v. Nat.

Res. Def. Council, Inc., 467 U.S. 837, 843 n.9 (1984)). Second, if the regulation is ambiguous,

No. 22-5442 United States v. You Page 22

the agency’s reading must fall within its “zone of ambiguity.” Id. at 2416. Even then, we must

decide whether the “character and context” of the reading entitle it to deference. Ibid. That is,

the reading must be the agency’s official position, “implicate [the agency’s] substantive

expertise,” id. at 2417, and reflect “fair and considered judgment,” ibid. (quoting Christopher v.

SmithKline Beecham Corp., 567 U.S. 142, 155 (2012)).

Applying Kisor’s framework, we defer to the Sentencing Commission’s interpretation of

“loss.” First, a genuine ambiguity exists. This court, canvassing several dictionaries, found that

the term “loss” in § 2B1.1 has no one definition and “can mean different things in different

contexts.” Riccardi, 989 F.3d at 486. Although Riccardi declined to declare “loss” ambiguous,

its reasoning makes it easy for us to conclude that the definition of loss “has no single right

answer.” Kisor, 139 S. Ct. at 2145.

You points to a recent Third Circuit case, United States v. Banks, 55 F.4th 246 (3d Cir.

2022), to argue that “the ordinary meaning of the word ‘loss’ is the loss the victim actually

suffered.” The court in Banks, however, conceded that “loss” could include intended loss in

other contexts. Banks, 55 F.4th at 258. It held only that, in the context of a § 2B1.1

enhancement “for basic economic offenses,” loss meant actual loss. Ibid. But without

consulting the “traditional tools” of the commentary’s “structure, history, and purpose” to reach

that conclusion, Kisor, 139 S. Ct. at 2415, Banks’s attempt to impose a one-size-fits-all definition

is not persuasive. See Phillips, 54 F.4th at 382–83 (“[L]iteral or dictionary definitions of words

will often fail to account for settled nuances or background conventions that qualify the literal

meaning of language and, in particular, of legal language.” (quoting United States v. Tate, 999

F.3d 374, 378 (6th Cir. 2021))). The context and purpose of the Guidelines clarify that “loss”

can also mean intended loss in the § 2B1.1 context. The Guidelines note that the purpose of

estimating “loss” is to assess “the seriousness of the offense and the defendant’s relative

culpability.” § 2B1.1 cmt. (background); see id. App. C Supp., at 104–05 (Amend. 793) (noting

“the Commission’s belief that intended loss is an important factor” because it focuses

“specifically on the defendant’s culpability”). You’s interpretation would lead to vastly different

sentences for similarly culpable defendants where one defendant successfully stole trade secrets

No. 22-5442 United States v. You Page 23

but the other did not. For someone like You, who was arrested before causing actual loss,

including losses that she intended is a reasonable way to gauge her culpability.

For these reasons, the Commission’s commentary also falls “within the zone of

ambiguity” of § 2B1.1. Kisor, 139 S. Ct. at 2416. Because federal theft statutes can “cover a

broad range of conduct with extreme variation in severity,” the loss caused or intended allows

courts to issue sentences that reflect defendants’ “relative culpability.” § 2B1.1 cmt.

(background); see also id. § 1B1.3 (requiring that a defendant’s offense level be determined in

part by “all harm that resulted” from the defendant’s crimes and by “all harm that was the object

of such acts”).

Finally, the character and context of the Commission’s reading entitles it to deference.

The Guidelines commentary represents the official position of the Commission. Phillips,

54 F.4th at 385. The commentary implicates the Commission’s expertise in “[d]eveloping

proportionate penalties for hundreds of different crimes by a virtually limitless array of

offenders.” Mistretta v. United States, 488 U.S. 361, 379 (1989). And it also reflects the

Commission’s “fair and considered judgment.” Kisor, 139 S. Ct. at 2417 (citation omitted).

Included in the Guidelines since its inception, the Commission’s commentary is no “ad hoc

pronouncement.” Phillips, 54 F.4th at 385. Therefore, the district court properly considered

intended loss in calculating You’s Guidelines range.

B. Calculating Intended Loss

“Determining the value of a trade secret . . . is no easy task.” United States v. Howley,

707 F.3d 575, 582 (6th Cir. 2013). But district courts need not reach an exact figure for the loss

that a victim suffered or the amount of harm that a defendant caused or intended to cause; a

“reasonable estimate” will do. Ibid. (quoting U.S.S.G. § 2B1.1 cmt. n.3(C)). Because district

courts are well positioned to assess the evidence and estimate loss, we review the district court’s

determination of the amount of loss attributable to You for clear error. United States v. Warshak,

631 F.3d 266, 328 (6th Cir. 2010).

“Even a reasonable estimate, however, requires some explanation.” Howley, 707 F.3d at

582. The district court’s reasoning reveals that it failed to follow its own logic in two important

No. 22-5442 United States v. You Page 24

ways. First, the district court used estimates that it had rejected earlier in its analysis. The

district court declined to calculate anticipated profits based on You’s projections in her Thousand

Talents application of over $220 million in future profits, rejecting them as speculative and

“likely inflated” due to “puffery.” You’s estimate of $7 billion for the annual world can-coating

market, the court noted, was likely “intended to entice the Chinese government into issuing a

grant.” Yet, in estimating the annual Chinese market for can coatings to equal $2.9 billion, the

district court appears to have relied on an estimate that was also in You’s Thousand Talents

application—the same source whose projections the court had previously dismissed. We need

not take a side on this inconsistency by determining whether You’s projections were indeed

speculative, but we ask the district court to resolve it.

The district court’s confusion of profits with sales compounds this error. Although the

court claimed to determine the loss amount based on anticipated profits, the numbers it estimated

were of You’s anticipated sales. See United States v. Xu, 2022 WL 16715663, at *7 (S.D. Ohio

Nov. 5, 2022) (calculating anticipated profit in a trade-secrets case by multiplying revenues by

the profit margin). The problem is not solely that the district court used sales rather than profits

to assess You’s intended loss, but rather that it did not stick to its choice. An internally

inconsistent estimate is not a “reasonable” one. § 2B1.1 cmt. n.3(C).

The government responds that “it was not unreasonable” to assume that marginal costs

would be low in a concentrated market where the companies had already spent millions of

dollars developing their BPA-free formulas. This argument fails for several reasons. First, the

court likely would have indicated that it meant to discount all costs from its calculation. For

profit to match revenue, there must be zero cost. That means no operating expenses, no

manufacturing costs, no research and development costs, or anything else. It is difficult to

believe that, by equating revenue with profit, the court would have made such a significant

assumption without noting it, especially when the court identified other, more complex

assumptions in its model. Second, the district court never mentioned “marginal costs,” or

signaled that it cared nothing about those costs rather than the sunk costs of developing BPA-free

technology—an investment that the competing companies likely would not have made unless

they expected to recoup it. Nor is it clear, at least without some evidence, that marginal costs

No. 22-5442 United States v. You Page 25

would be very low or nonexistent in the can-coating context. A “reasonable reduction” that

accounted for You’s anticipated profit margin might well have brought You’s total intended loss

below $65 million and affected her Guidelines range. In deciding to calculate anticipated profits,

the district court needed to pick some profit margin—arguably, any margin between 0% and

100%. Its failure to do so was clear error.

Finally the government claims that any error was harmless because the court could have

calculated You’s intended loss in other ways to reach the same or higher offense-level. An error

in calculating the Guidelines range is harmless only if the government can show “with certainty

that the error at sentencing did not cause the defendant to receive a more severe sentence.”

United States v. Gillis, 592 F.3d 696, 699 (6th Cir. 2009) (quoting United States v. Lanesky,

494 F.3d 558, 561 (6th Cir. 2007)). On remand, the district court may well calculate a similar

figure for intended loss. And even if its new number varied from its original calculation, the

court still could order the same sentence for You. But we cannot be certain that the district court,

after correcting its error, would issue the same sentence again. See United States v. Castilla-

Lugo, 699 F.3d 454, 459 (6th Cir. 2012); Gillis, 592 F.3d at 699. The district court already

rejected as “inappropriate” the Guidelines’ suggested method of calculating intended loss by

estimating the competing companies’ costs of developing the BPA-free technology. See

U.S.S.G. § 2B1.1 cmt. n.3(C)(ii). As to its chosen approach of estimating anticipated profits, the

court deemed speculative the government’s suggestion of using You’s Thousand Talents

projections. The district court on remand might again look to anticipated profits, tweak its

model, and reach a loss amount that corresponds with a lower Guidelines range and,

subsequently, a lower sentence.

CONCLUSION

For the foregoing reasons, we AFFIRM You’s conviction, but VACATE and

REMAND the district court’s sentence.