Arrest of a 'rock star': JD.com founder's plight captivates China
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Arrest of a 'rock star': JD.com founder's plight captivates China

Richard Liu, the Chinese technology executive arrested in the United States on suspicion of sexual misconduct, has returned to China — where he is the No. 1 topic of conversation.

Chinese news outlets and social media users were consumed Monday by details of Liu's arrest. His mug shot, taken by law enforcement officials in Minnesota, was everywhere online. Chinese netizens speculated about how his wife — a celebrity in her own right, known as Sister Milk Tea — might respond and parsed unfamiliar legal terms.

The intense reactions to Liu's legal troubles reflect the public's fascination with China's self-made tech tycoons, who have become symbols of the country's rise as a global power and its upward social mobility. Their books are best sellers. Their private lives are tabloid fodder. Their speeches on success and entrepreneurship are perpetually running on TV screens at airports.

In effect, they are the rock stars of China's Gilded Age, and Liu is one of the brightest. His company, JD.com, courts the country's growing middle class with quality brand products instead of the shoddy copycats that are common on the Chinese internet. Today, its shares trade on the Nasdaq at a market value of about $US50 billion ($69.3 billion).

On Friday, Liu — whose Chinese name is Liu Qiangdong but who goes by Richard in the English-speaking world — was arrested over alleged sexual misconduct. Police officials in Minneapolis said they were treating the case as an active investigation. In Minnesota, the term "criminal sexual conduct" covers a range of nonconsensual sexual contact.

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The mug shot taken of Chinese billionaire Liu Qiangdong, who was arrested in Minneapolis on suspicion of criminal sexual conduct.

The mug shot taken of Chinese billionaire Liu Qiangdong, who was arrested in Minneapolis on suspicion of criminal sexual conduct.

Photo: AP

JD.com has maintained that Liu was falsely accused and on Monday said he had been released without being charged and without having to post bail. The executive has hired lawyers but has returned to work in China, the company said, without saying when he arrived in the country.

Throughout, Chinese internet users have obsessed over the minutiae of the case, many of them getting a crash course in the US legal system in the process.

"This photo of Liu Qiangdong is called a mug shot," a blogger and journalist who goes by the name Michael Anti wrote on WeChat, the ubiquitous Chinese messaging and social media platform.

He went on to explain that mug shots were considered public information in the United States and can be released to the media.

Descriptions of "probable cause" and "released pending complaint" were also widespread. There were even photographs and audio recordings of John Elder, a spokesman for the Minneapolis Police Department.

Others speculated over Liu's marriage to Zhang Zetian, who rose to fame as a student when a photo of her holding a cup of milk tea was widely shared on social media. Nicknamed "Sister Milk Tea," Zhang met Liu while she was studying in the United States, and they married in 2015. The couple have been both praised and criticised in China for cataloging online the intimate details of their lives, including their wedding and Zhang's pregnancy.

Liu's marriage to Zetian Zhang has been the source of controversy in China.

Liu's marriage to Zetian Zhang has been the source of controversy in China.

Photo: Pascal Le Segretain

Liu's arrest also prompted derision. In a previous video interview, he had insisted he had not married Zhang for her looks.

"I am face blind," he said. "I can't tell who is pretty and who is not."

Referring to those remarks, one online user joked, "Maybe he mistook the other woman as Sister Milk Tea. He is face blind, after all."

Beyond online comments, the case also put a spotlight on JD.com's fierce rivalry with Chinese e-commerce giant Alibaba, and in particular the clash of personalities between the companies' founders.

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If the most intense reality show in the United States is national politics, business feuds take top billing in China. The workings of the government are carried out in a black box, off limits to media scrutiny and public discussion, but antagonism in the business world is carried out in the open. Among the business tycoons, the heads of China's internet companies are the hottest stars, the leaders of JD.com and Alibaba chief among them.

Where Liu is like an aggressive boxer — a straight talker and a formidable disciplinarian — Alibaba's executive chairman, Jack Ma, is more of a tai chi master, skillful at gentle maneuvering. Even before his arrest in Minnesota, Liu was in the news a lot with a colourful private life and blunt speaking style.

Alibaba founder Jack Ma has predicted that JD.com will end in "tragedy" die to its business structure.

Alibaba founder Jack Ma has predicted that JD.com will end in "tragedy" die to its business structure.

Photo: Bloomberg

In July, a judge in Australia rejected his request to prevent the release of his name in connection with a case in which a sexual assault was said to have taken place after a 2015 party at his Sydney penthouse. That case has not generated as much online attention as the recent arrest, largely because Liu was not charged with a crime or accused of any wrongdoing. Still, at the time, JD.com reposted a lawyer's statement on Chinese social media platforms that aimed to quell any rumors tied to the Sydney case.

Born in a poor part of the eastern province of Jiangsu, Liu has made much of his Everyman credentials. Able to afford meat only once or twice a year, his family typically ate sweet potatoes and corn as dinner staples. Until recently, he would put on a helmet and JD.com's red uniform to make deliveries on a three-wheeled electric bike. He calls the 100,000-odd deliverymen who work for JD.com his "brothers" and often trumpets how much better they are paid than those employed by competitors.

As it has grown, JD.com has become a serious competitor to Alibaba and, increasingly in recent years, the two are going head to head, vying for the attentions of growing numbers of affluent online shoppers in China.

Both companies have tried to lure popular brands to open virtual stores on their sales platform, a battle playing out most aggressively in fashion, traditionally Alibaba's stronghold. Ma's company scored a major victory in 2015 when Uniqlo, the Japanese casual wear company, quit JD.com to sell its wares on Alibaba's platform. Last year, a group of apparel merchants also made the jump, a move that JD.com's chief financial officer said on a recent earnings call that the company was still recovering from. (Alibaba has denied it pressured any brands into exclusive arrangements.)

There is no love lost between the two men, either. Ma famously once said that JD.com would eventually end as a "tragedy," because its business model was excessively labour and capital intensive. Liu, for his part, has accused Alibaba of not doing enough to fight fakes on its platform, a charge that Ma has denied.

It is little wonder, then, that many Chinese internet users responded to the news of Liu's arrest by posting photographs of Ma laughing.

The New York Times