Huawei is set to face trial in Brooklyn starting September 8 over US allegations that the Chinese technology conglomerate ran a decades-long racketeering scheme to steal American technology and gain an unfair business advantage.
The case, in the U.S. District Court for the Eastern District of New York, is described as a landmark corporate-espionage trial. A jury will hear evidence after nearly a decade of litigation over claims that Huawei engaged in a pattern of wire fraud, bank fraud, intellectual property theft and sanctions offences.
US prosecutors accuse Huawei of operating as an “organized crime group”. They allege that the conduct extended across 20 years and included taking competitors' trade secrets, misleading banks and violating sanctions.
The trial is expected to last several months. It could expose Huawei to one of the largest corporate criminal fines in US history if it is convicted. The specific amount of any potential fine has not been stated.
The central question for the jury will be whether prosecutors can prove that the alleged conduct formed a sustained scheme aimed at securing an unfair business advantage. The case joins allegations of technology theft with accusations involving financial dealings and sanctions compliance.
Among the prosecution allegations is that Huawei maintained an internal unit called the “competition management group”. The group allegedly paid monthly bonuses to employees who obtained valuable information from competitors. Employees were allegedly able to send obtained data to a dedicated mailbox through encrypted email.
Prosecutors are also expected to rely on an incident involving T-Mobile in 2013. A Huawei employee allegedly entered a T-Mobile laboratory, secretly placed a robot arm into a laptop bag and took it. Before T-Mobile recovered the arm, a Huawei engineer allegedly sent photographs and dimensions of its parts to other colleagues.
The sanctions-related allegations concern dealings connected to Iran and North Korea. Huawei used “A2” as a code for Iran and “A9” as a code for North Korea, according to the allegations. Huawei representatives allegedly denied to banks that the company was involved in multiple North Korean projects.
Huawei also allegedly helped the Iranian government install surveillance equipment that was used to monitor, identify and detain anti-government protesters during demonstrations in 2009.
The proceedings bring renewed attention to a case that had faded from the spotlight in recent years. They follow the release from detention in Canada of Huawei finance chief Meng Wanzhou five years ago.
The trial will determine whether the government’s evidence establishes the alleged scheme. The brief does not specify the company’s defence strategy, the composition of the jury, whether other Huawei executives or employees will be tried alongside the company, or whether Meng will testify.
Comments (0)