Chinese tech giant pleads not guilty to stealing trade secrets

World Today

The logos of Huawei are displayed at it retail shop window reflecting the Ministry of Foreign Affairs office in Beijing, Tuesday, Jan. 29, 2019. China’s government called on Washington on Tuesday to “stop the unreasonable crackdown” on Huawei following the tech giant’s indictment in the U.S. on charges of stealing technology and violating sanctions on Iran. (AP Photo/Andy Wong)

Chinese technology giant Huawei is facing criminal charges in the U.S. state of Washington. Officials have accused the company of stealing trade secrets from the U.S. telecom, T-Mobile. Huawei representatives made their initial court appearance in Seattle on Thursday.

CGTN’s Mark Niu has details.

At a pre-trial hearing at a U.S. District Court in Seattle, Huawei’s lawyers plead not guilty to conspiring to steal trade secrets, wire fraud, and obstructing justice, all in an effort to steal technology from one of America’s largest wireless carriers, T-Mobile. The judge set the trial date for March of 2020 – more than a year away.

“The attorneys in the courtroom said there is so much evidence they have to gather it’s going to be as complex as any case they’ve faced before,” said GeekWire Technology Reporter Nat Levy. “So it sounds like we are breaking new ground and it will be interesting to see what comes next.”

The case stems from a number of interactions between 2012 and 2014 at the headquarters of wireless carrier T-Mobile. T-Mobile used a robotic system called Tappy to test phones from other companies before selling them in its stores. Huawei was working on a similar device at the time.

In the indictment, the U.S. Justice Department alleges several Huawei employees took unauthorized photos of Tappy. Prosecutors said one of them even stole one of Tappy’s robot arms  so he could take more precise measurements, which he then sent back to Huawei’s headquarters. In 2017, T-Mobile sued Huawei in a civil suit and was awarded $4.8 million in damages.

But, why are criminal charges necessary?

“That’s a mystery,” said Levy. “There’s lots of talk about relations between the U.S. and China getting tougher. But there’s been kind of a broader crackdown against Huawei and some of its practices, and this might be a part of that.

Lawyer Dan Harris said it is rare for a federal suit to follow a civil suit, but not unheard of. He said the case could hurt Huawei on a number of levels.

“Just on a business level, who is going to want to do business with a company that has been accused of trade secret theft?” said Harris. “And if they get convicted, obviously, it’s going to be even one level stronger than that. I presume it’s also going to exclude Huawei from certain contracts.”

If convicted, Huawei may have to pay fines of up to three times the value of the trade secrets stolen, or a maximum of $5 million.