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Huawei challenges U.S. defense bill sanctions battle ramps up

HONG KONG (Reuters) – China’s Huawei Technologies Co Ltd has filed a legal motion seeking to declare a U.S. defense law unconstitutional, in the telecom-equipment maker’s latest attempt to fight sanctions from Washington, which threatens to push it out of the global markets.

The motion for a summary judgment in the lawsuit against the U.S. government, filed late Tuesday in U. S. District Court for the Eastern District of Texas, asks a judge to declare the 2019 National Defense Authorization Act (NDAA) is unconstitutional. Huawei filed the lawsuit in March.

The NDAA bill, passed by the U.S. Congress last summer, places a broad prohibition on federal agencies and their contractors from the use of Huawei equipment on national security grounds, indicating the company has ties with the Chinese government.

Huawei, the world’s largest telecom network gear maker, has repeatedly denied it is controlled by the Chinese government, army or security services.

The US Secretary of State Mike Pompeo kept the pressure on the Huawei on Wednesday.

“Huawei is an instrument of the Chinese government,” Pompeo said in an interview with Fox Business Network. “They are deeply connected. It is something that is difficult for Americans to understand.”

Glen Nager, a partner at law firm Jones Day and lead counsel for Huawei, told Reuters the U.S. district court had agreed on a schedule to hold hearings in September on moves by the opponents.

A number of legal experts say that Huawei’s lawsuit was likely to be rejected, because the AMERICAN courts are reluctant to guess what the national security provisions by other branches of the government.

The lawsuit “it will be an uphill battle because Congress has broad powers to protect us against alleged threats of national security,” said Franklin Turner, government contracts attorney at also close, and English.

Huawei’s Chief Legal Officer Song Liuping attends a press conference on the Huawei’s of the ongoing legal proceedings against the U.S. government the National Defense Authorization Act (NDAA) action at the head office in Shenzhen, Guangdong province, China May 29, 2019. REUTERS/Jason Lee

In November 2018, a federal court of appeal rejected a similar lawsuit filed by the Russian cybersecurity company Kaspersky Lab, which was a challenge to a ban on the use of the company’s software in US government networks.

‘DANGEROUS PRECEDENT’

Earlier this month, the U. S. Commerce Department puts Huawei on a trade blacklist which doesn’t allow companies to do business with the Chinese company, a move that immediately disrupted the global tech sector.

Huawei’s chief legal officer, Song Liuping, on Wednesday said the company was reviewing ways to fight against the U.S. ban, which he said would affect more than 1,200 suppliers and threatened to affect 3 billion customers in 170 countries.

Song said Washington’s use of administrative regulations and laws to punish a single company, “sets a very dangerous precedent.”

“Today, the telecom and Huawei, tomorrow it can be your company, your industry, your customers,” he told reporters at Huawei’s headquarters in Shenzhen.

The ban, along with separate allegations of fraud and corporate theft that the United States has made against Huawei and the chief financial officer, has aggravated the trade war between Beijing and Washington.

Huawei, which has a 90-day deferral of the ban, has denied that its products pose a threat to the security and said Washington is trying to limit her activities.

Vincent Pang, Huawei’s senior vice president and head of corporate communications, said the executive order, and a black list had above the boundaries of normal competition in the market.

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“This could lead to the start of the fragmentation of the global tech ecosystem and standards,” Pang said on Wednesday at the Huawei’s headquarters.

Pang also said that he did not expect the political situation to the delay of the introduction in China of the fifth-generation (5G) network technology.

Reporting by Sijia Jiang; Additional reporting by Rishika Chatterjee and Jan Wolfe; Editing by Christopher Cushing, Jeffrey Benkoe and Paul Commented

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