Alphabet Faces 14-Count Indictment Over Pixel Tensor Trade Secrets

This article first appeared on GuruFocus.

Alphabet (NASDAQ:GOOG) is confronting a serious legal test after federal prosecutors unsealed a 14-count indictment alleging that two former Google engineers and one of their husbands conspired to steal trade secrets tied to the company’s Tensor processor used in Pixel phones. The three defendants Samaneh Ghandali, 41, her sister Soroor Ghandali, 32, and Mohammadjavad Khosravi, 40 were arrested Thursday and made initial appearances in federal court in San Jose, California, according to the Justice Department. If convicted on the most serious charges, they could face sentences of at least 20 years in prison, underscoring the weight of the allegations now facing them.

Prosecutors allege that while working as a hardware engineer in Silicon Valley, Samaneh Ghandali transmitted more than 300 files, including company trade secrets, to a third-party communications application based outside the United States. Soroor Ghandali, who had been an intern before later joining another tech firm, is accused of sending 34 files through the same method. The indictment states that the trio intended to provide the trade secrets to third parties, although it does not specify whether that transfer ultimately occurred. Khosravi, who had applied multiple times to Google but was not hired and instead worked for a separate technology company, was also charged in connection with the alleged conspiracy and destruction of evidence.

Google said its internal security systems detected the downloading activity and alerted the FBI, a detail that suggests the company moved quickly once the activity was identified. We have enhanced safeguards to protect our confidential information and immediately alerted law enforcement after discovering this incident, spokesperson Jose Castaneda said, describing the indictments as an important step toward accountability. While the longer-term financial implications for Alphabet could be limited if the alleged conduct was contained early, the case highlights how strategically sensitive in-house chip development particularly processors like Tensor that support Pixel devices has become in an increasingly competitive semiconductor landscape.