This is quite possibly part of the problem. I think the perspective between China and the West differs greatly both in terms of IP rights and perceived value.
I have had Chinese colleagues express amazement that a relatively simple mechanism can cost $250-$300K in the US, when they can build it in China for $12-15K, and sell it for $20K, with a very healthy profit margin. I think from that standpoint, they are simply exploiting an opportunity. Their concept of IP rights is dramatically different from ours.
My understanding is that IP laws in China only apply to Chinese intellectual property. IP from outside is fair game. They are certainly not the only nation in the world to hold that philosophy.