Taiwanese company HTC has not been having a happy time of late. Senior departures, including its COO; a halving of market share since 2011; former UK execs setting up a rival company; disappointing Q2 financials; and the possibility of the first ever loss in the company’s history in Q3.

But the latest saga in the company’s troubles read more like the plot of a soap opera than real-life. First, several of HTC’s former lead designers were arrested last week on suspicion of fraudulent expenses claims and leaking of trade secrets. Now Engadget reports that one of those arrested, ex-VP of Product Design Thomas Chien, may have been involved in a conspiracy with a Chinese municipal government to use both the trade secrets are purloined cash to create a rival smartphone company in China …  expand full story