DOJ Files Lawsuit Charging Huawei Of Technology Theft From US Firms

The Department of Justice has charged Chinese telecommunications giant Huawei and its American subsidiaries with racketeering conspiracy and a decades-long plan to steal trade secrets and other sophisticated technology from U.S. firms.

A 16-count superseding indictment filed in federal court in Brooklyn, New York, charges Huawei Technologies Co. Ltd. and U.S. subsidiaries with conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act (RICO).

Besides Huawei, charges have also been framed against Huawei Device Co. Ltd., Huawei Device USA Inc., Futurewei Technologies Inc. and Skycom Tech Co. Ltd. as well as Huawei’s Chief Financial Officer Wanzhou Meng.

Meng is currently in the custody of Canadian Government. The daughter of the Chinese conglomerate’s founder, Meng is facing extradition to the United States in a previous case.

The lawsuit claims that the U.S. government’s investigation has found decades-long efforts by Huawei and its subsidiaries, both in the U.S. and in China, to misappropriate intellectual property, including from six U.S. technology companies, in an effort to grow and operate Huawei’s business.

The misappropriated intellectual property included trade secret information and copyrighted works, such as source code and user manuals for internet routers, antenna technology and robot testing technology. Huawei, Huawei USA and Futurewei allegedly agreed to reinvest the proceeds of this racketeering activity in Huawei’s worldwide business, including in the United States.

As part of the scheme, Huawei offered bonus to employees who obtained confidential information from competitors.

Huawei obtained intellectual property relating to internet router source code, cellular antenna technology and robotics, DOJ said in a press release.

By doing so, the world’s largest telecommunications equipment manufacturer was able to drastically cut its research and development costs and associated delays, giving the company a significant and unfair competitive advantage, according to DOJ.

The superseding indictment also includes new allegations about Huawei and its subsidiaries’ involvement in business and technology projects in countries subject to U.S. sanctions, such as Iran and North Korea.

The Department of Justice officials say internal Huawei documents referred to these countries using code names. The code “A2” referred to Iran, and “A9” referred to North Korea.

Huawei employees also allegedly lied about Huawei’s relationship to Skycom, falsely asserting it was not a subsidiary of the company.

Huawei denies the U.S. charges.

As the government’s investigation is ongoing, the Department of Justice urged people with knowledge of misconduct by Huawei, its subsidiaries, employees or agents to contact the FBI’s New York Field Office at 1-800-CALL-FBI.

The Congress had warned last year that Chinese telecom companies like Huawei and ZTE present serious threats to the national security of the United States and its allies.

Huawei was banned from buying components and technology from U.S. firms without prior approval from the U.S. government.

Many US partners and allies are considering relying on these Chinese telecommunications companies to build their 5G networks, even after the U.S. government called on these countries to abandon utilizing Huawei and ZTE.

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