Huawei drops lawsuit against US after having its telco equipment returned

The telco equipment was detained for two years.
Written by Campbell Kwan, Contributor

Huawei has dropped a lawsuit against the United States that was filed in response to having its telco equipment seized by the country's government authorities.

"After a prolonged and unexplained seizure, Huawei has decided to drop the case after the US government returned the equipment, which Huawei views as a tacit admission that the seizure itself was unlawful and arbitrary," Huawei said in a statement.

The US Commerce Department seized Huawei's telco equipment while it was in transit in September 2017 as it wanted to investigate whether the shipment required an export licence. 

During the two years since the equipment was seized, the US government did not make a decision on whether an export license was required for the equipment to be shipped back to China, and continued to hold onto it until Huawei filed the lawsuit in June.

See also: Microsoft's top lawyer: Trump's Huawei ban makes no sense

Since the lawsuit was filed, according to court documents, the US government has agreed to return the equipment, confirming that no export license was ever required for the shipment back to China.

The detained equipment included computer servers, ethernet switches, and other telecommunications gear that were made in China, Huawei said.

Besides returning the equipment, the US government has not provided any further explanation for the detention of the equipment or the "extreme delay" in making a license determination, Huawei's legal counsel said in its dismissal of the lawsuit. 

The US issues sanction against Chinese professor

At the same time, the US issued a sanction last week against a Chinese professor for allegedly conspiring to commit wire fraud.

The US government alleges that Chinese professor, Bo Mao, gained access to a Calfornian company's circuit board technology and attempted to reverse-engineer the board and provide those details to a "Chinese telecommunications conglomerate".

The Chinese company allegedly has been attempting to "misappropriate" the Californian company's circuit board technology since at least 2016, according to a Texas court filing by the US government last month.

Bo Mao is an associate professor at Xiamen University and was a visiting professor at the University of Texas at Arlington when he gained access to the circuit board technology. 

See alsoHuawei trade ban: US officials figure out how to handle Trump's U-turn  

During his time at the University of Texas, Mao had entered into a licensing and non-disclosure agreement with the Californian company to access the circuit board technology, stating that the technology would only be used for academic research purposes.

According to the court filing submitted by the US government last month however, an expert witness who looked at the piece of technology alleges that "persons in possession of the Open-Channel SDK attempted a hack of the SDK board".

The Californian company and Chinese telecommunications conglomerate are reportedly CNEX and Huawei, according to Reuters' sources. The two companies were engaged in a legal spat since 2017 over trade secrets that ended in June. 
As the report details, in December 2017, Huawei brought a lawsuit against CNEX and a former employee, Yiren Huang, claiming theft of trade secrets. Huang created CNEX three days after leaving Huawei and filed several patent applications that were allegedly based on or related to the work he performed while being employed at Huawei. 

Shortly after, CNEX actioned a counterclaim, saying Mao had asked for one of its circuit boards for a research project and that, after it sent the board to the professor, he used it for a study tied to Huawei.

As Reuters reported, the involved jury in June decided that neither Huawei nor CNEX were entitled to damages. 

Huawei is currently in a series of legal battles against the US government, including one where the company is suing the US for banning US federal agencies and their contractors from using Huawei equipment due to security concerns, claiming the ban is unconstitutional. 

Meanwhile, the US released a pair of indictments against Huawei at the start of the year, for allegedly misrepresenting Huawei's ownership and control of Iranian affiliate Skycom to banks -- which breached UN, US, and EU sanctions -- and allegedly stealing trade secrets from T-Mobile

The company's CFO, Meng Wanzhou, is also set to attend court on January 20, 2020 to appeal the application for her to be extradited to the US. Meng was also indicted, along with Huawei, for allegedly misrepresenting Huawei's ownership and control of Iranian affiliate Skycom to banks.

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