Huawei charged with Racketeering


VCG via Getty Images

BEIJING, CHINA – MAY 30: A pedestrian walks past a Huawei store on May 30, 2019 in Beijing, China. (Photo by VCG/VCG via Getty Images)

Araby Scott, Contributor

Huawei, based out of China, is the world’s largest  chinese tech company that provides smartphones and other telecommunications equipment for over 170 countries. The tech giant was founded in 1987, by Ren Zhengfei and expanded to the U.S in the early 2000s. February 13th 2019, a federal court in the Eastern district of New York accused Huawei (and its affiliations, “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.” ) with a pattern of racketeering. It is believed that Huawei has stolen information form six U.S tech companies, CNEX Labs, Fujitsu, Quintel Technology, Motorola Solutions, and Cisco Systems.

The offical statement given by the United states department of Justice is as follows, “Huawei’s efforts to steal trade secrets and other sophisticated U.S. technology were successful. Through the methods of deception described above, the defendants obtained nonpublic intellectual property relating to internet router source code, cellular antenna technology and robotics. As a consequence of its campaign to steal this technology and intellectual property, Huawei was able to drastically cut its research and development costs and associated delays, giving the company a significant and unfair competitive advantage.”

The information that was stolen ranges from source codes to manuals for unreleased technology. A the statement made by the Department of Justice upon charging Huawei, “The new charges in this case relate to the alleged decades-long efforts by Huawei, and several of its subsidiaries, both in the U.S. and in the People’s Republic of China, to misappropriate intellectual property, including from six U.S. technology companies, in an effort to grow and operate Huawei’s business.”

Huawei was investigated based upon a pattern of  suspicious behavior, the most infamous being the 2004 Chicago trade show incident. A Huawei employee snuck into a trade show in Chicago and removed the covers of networking devices and photographed the circuitry inside in various technology booths. When the employee was spotted he was wearing a badge that read “Weihua”, which is an anagram of Huawei. In 2003 Cisco Systems sued Huawei for infringing on their patents for routers and switches. Both parties settled out of court, but it was clear to the public the damage that was done t0 Cisco Systems. Cisco issued a statement after the lawsuit settled, “Completion of lawsuit marks a victory for the protection of intellectual property rights.” they added, “Cisco was portrayed by the Chinese media as a bullying multinational corporation… the damage to Cisco’s reputation in China outweighed any benefit achieved through the lawsuit.”

Countries around the world are currently working to switch from 4G to 5G, most countries (who plan to implement 5G) have handed the task over to Huawei or its affiliations. The U.S will not be utilizing Huawei to implement any 5G program. Attorney General  William P. Barr believes that, “The risk of losing the 5G struggle with China should vastly outweigh other considerations.” However, most officials worry that doing any further business with Huawei or any of its partners could put the United States in more trouble.