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Huawei Charged with Stealing Trade Secrets from 6 Companies

The US Department of Justice (DoJ) and the Federal Bureau of Investigation (FBI) charged Huawei with racketeering and conspiring to steal trade secrets from six US firms, in a significant escalation of a lawsuit against the Chinese telecom giant that began last year.


2 min read
Huawei Charged with Stealing Trade Secrets from 6 Companies

The new charges today represent an escalation in the US' legal battle against the Chinese telecommunications giant.

Accusing Huawei and its affiliates of "using fraud and deception to misappropriate sophisticated technology from US counterparts," the new charges allege the company of offering bonuses to employees who obtained "confidential information" from its competitors.

The US DOJ claims it uncovered a "decades-long efforts by Huawei, and several of its subsidiaries, both in the US and in the People's Republic of China, to misappropriate intellectual property, including from six US technology companies, in an effort to grow and operate Huawei's business."

The DOJ says stolen information includes trade secret information and copyrighted works, such as source code and user manuals for internet routers, antenna technology, and robot testing technology:

"The means and methods of the alleged misappropriation included entering into confidentiality agreements with the owners of the intellectual property and then violating the terms of the agreements by misappropriating the intellectual property for the defendants' own commercial use, recruiting employees of other companies and directing them to misappropriate their former employers' intellectual property, and using proxies such as professors working at research institutions to obtain and provide the technology to the defendants."

"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," the unsealed federal indictment alleged.

The alleged theft enabled Huawei illegally obtain nonpublic technology relating to internet router source code, cellular antenna technology, and robotics, giving the company an unfair competitive advantage, prosecutors said.

Although the six US firms are unnamed in the indictment, it's suspected that the companies in question are Cisco Systems, Motorola Solutions, Fujitsu, Quintel Technology, T-Mobile, and CNEX Labs.

The report further accuses Huawei of engaging in business with countries subject to US, EU, and UN sanctions, including Iran and North Korea, as well as for trying to conceal its involvement. Huawei is alleged to have used code names for these countries, such as "A2" for Iran, and "A9" for North Korea.

Huawei, for its part, has denied all the charges. "This new indictment is part of the Justice Department's attempt to irrevocably damage Huawei's reputation and its business for reasons related to competition rather than law enforcement," the company was quoted as saying to the BBC.

The company, however, fired back against the allegations of spying, stating that the US itself has a long history of spying on its allies and adversaries, referencing a report by The Washington Post that detailed how the Central Investigative Agency (CIA) bought a company called Crypto AG and used it to intercept foreign governments' communications for decades.

The ongoing tussle against Huawei, which is also seen as a battle for tech supremacy between the US and China, has ensnared many countries, with the Trump administration actively dissuading its partners such as the UK from using Huawei's technology for 5G wireless networks.

In spite of the mounting pressure, the UK last month announced it would continue using Huawei's equipment but limiting its role to building peripheral parts of the 5G and full-fiber network. France, likewise, has said it won't exclude the firm from supplying equipment for 5G networks in the country.

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