- The US Department of Justice has accused Huawei of conspiring to steal secrets from five US companies
- Huawei is accused of a prolonged campaign of theft, covering a 20 year period
- Admissions from Huawei’s chief financial officer, Meng Wanzhou, are set to be used as evidence in the trial
Court proceedings have begun against Huawei in the United States, with the US Department of Justice accusing the Chinese tech giant of stealing trade secrets from competing US companies.
Huawei – which unusually for Chinese companies operating abroad is owned entirely by its staff – has denied all accusations of industrial espionage, intellectual property, and any other wrongdoing.
While accused of stealing from companies that include Cisco and T-Mobile, Huawei’s defense is that it is simply innovating and doing business as a competitor.
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Given the United States’ belligerent tone towards China under the current administration, that might seem a weak response. However, several concessions have been made to China in this case, not least the charges against Huawei’s chief financial officer, Meng Wanzhou. While charges against her were dropped, her evidence is set to be used in the case against Huawei.
The accusations against Huawei are numerous, but the most attention is on its alleged industrial espionage. It is accused of stealing trade secrets and misappropriating intellectual property from T-Mobile US, Cisco Systems, Motorola, CNEX Labs, and Akhan Semiconductor.
In the US government’s opening statement, Department of Justice trial attorney Taylor Stout stated: “For 20 years […] Huawei, a massive Chinese telecommunications company, victimized American companies and abused the American financial system, all in an effort to dominate the telecommunications industry around the world.”
Inevitably, the defense claimed that everything was ordinary innovation, rather than criminal activity. “Huawei earned its success,” said Brian Heberling, defending. “It’s about competition, not conspiracy. Innovation, not theft. Ordinary business dealings, not criminal conduct.”
State control?
The case also draws on a history of poor conduct from Huawei, which has been previously observed to have close ties with Skycom, a company that allegedly attempted to sell embargoed tech (specifically, Hewlett-Packard computer equipment) to an Iranian business.
Unlike other significant Chinese multinationals, Huawei is not state controlled. Rather, it is owned entirely by its staff, as opposed to an organization that might state-owned, have heavy state influence over them, or even “golden shares” that enable vetos or special board seats. Whether this was apparent to the US Department of Justice ahead of the initial investigation is not clear, but it does put a barrier against implications that the Chinese government were involved.
After taking eight years to come to trial, proceedings are expected to run for around three months.
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