This isn't shocking at all; this is SOP. China takes a shit on all copyrights, patents, trademarks. They steal & duplicate. Walmart was known for buying all things American small business, but then they'd sneak a few samples off to China & say, "Well, look! The Chinese are making your exact same product at x price. Can you match that?" Of course they can't. So Walmart bought the mostly equivalent but shittier goods, from China, to increase their profit margins.
Most recently brought to my attention: Shawn Woods & Rinne Traps USA brought the Flip-N-Slide mousetrap to market. The Chinese started ripping it off immediately.
Until the world calls them on their bullshit & stops buying, the practice is "profitable". We can expect it to continue.