Sun Sentinel Palm Beach Edition
Huawei sues to challenge security law
Experts see move by Chinese firm as a last-ditch option
SHENZHEN, China — Chinese tech giant Huawei is challenging a U.S. law that limits its sales of telecom equipment in the U.S. on security grounds as the company steps up efforts to preserve its access to global markets for next-generation communications.
Huawei Technologies Ltd.’s lawsuit, announced Thursday, asks a U.S. court to reject as unconstitutional a military-spending provision that bars the U.S. government and its contractors from using Huawei equipment.
It comes as the biggest global maker of network equipment fights a U.S. campaign to persuade allies to shun Huawei. That threatens to block access to major markets as phone carriers prepare to invest billions of dollars in next-generation cellular networks, known as 5G.
The complaint filed in Plano, Texas, the headquarters of Huawei’s U.S. operations, says the law is an unconstitutional “bill of attainder,” or a measure that singles out a specific entity for punishment. It says that denies the company due process, amounts to a “death penalty.”
The American Embassy in Beijing said it had no comment
on pending litigation.
Steven Schwinn, a professor at the John Marshall Law School in Chicago, said the lawsuit is likely to be dismissed by a judge. He said the “bill of attainder” claim, or punishment without due process, would be hard to prove.
But Schwinn said the lawsuit is one of Huawei’s only remaining options, short of trying to get Congress to reverse the ban.
“This strikes me as a lastditch effort to do something,” he said.
Franklin Turner, a partner at law firm McCarter & English, said there are parallels to a lawsuit filed by Kaspersky Labs in 2017 that was eventually thrown out as well. The U.S. government had barred federal agencies from using Kaspersky’s anti-virus products because of concerns about its ties to the Kremlin and Russian spy operations.
Turner said Huawei will likely keep fighting, but “to keep it going, is the legal equivalent of scaling Mount Everest without a rope.”
Huawei, China’s first global tech brand, is at the center of U.S.-Chinese tensions over technology competition and cyberspying. The company has spent years trying to put to rest accusations it facilitates Chinese spying or is controlled by the ruling Communist Party.
The company’s rotating chairman, Guo Ping, said the ban would limit competition, slowing the roll out of fifth-generation communications and raising consumer prices.
Huawei has pleaded not guilty to U.S. trade-theft charges unsealed by a federal court in Seattle in January.
The company’s CFO, Meng Wanzhou, was arrested Dec. 1 in Canada on U.S. charges of lying to banks about dealings with Iran. She is fighting extradition to the United States.
Huawei denies wrongdoing.
Huawei has about 40 percent of the global market for network gear. Its U.S. sales evaporated after a congressional panel in 2012 cited the company and a Chinese competitor, ZTE Corp., as security risks and told phone carriers to avoid dealing with them.
Huawei says the new law would shrink its potential U.S. market further by prohibiting the government from buying the Chinese vendor’s technology and from buying goods or services from or giving grants or loans to companies or other third parties that do.
Founded in 1987 by a former military engineer, Huawei overtook Ericsson in 2017 as the biggest global supplier of network gear. It says it supplies 45 of the world’s top 50 phone companies and has contracts with 30 carriers to test 5G wireless technology.
Chinese authorities and some industry analysts say Washington might be exaggerating security concerns to limit competition with Western vendors.
European governments are balking at U.S. pressure to ban Huawei.