U.S. accuses Huawei of stealing trade secrets, assisting Iran

[webfact]

U.S. accuses Huawei of stealing trade secrets, assisting Iran

By Karen Freifeld

 

FILE PHOTO: Huawei Chief Financial Officer Meng Wanzhou leaves B.C. Supreme Court following her extradition hearing at B.C. Supreme Court in Vancouver, British Columbia, Canada January 23, 2020. REUTERS/Jennifer Gauthier

 

NEW YORK (Reuters) - U.S. prosecutors on Thursday accused Huawei of stealing trade secrets and helping Iran track protesters in its latest indictment against the Chinese company, escalating the U.S. battle with the world's largest telecommunications equipment maker.

 

In the indictment, which supersedes one unsealed last year in federal court in Brooklyn, New York, Huawei Technologies Co was charged with conspiring to steal trade secrets from six U.S. technology companies and to violate a racketeering law typically used to combat organised crime.

 

It also contains new allegations about the company's involvement in countries subject to sanctions. Among other accusations, it says Huawei installed surveillance equipment in Iran that was used to monitor, identify, and detain protesters during the 2009 anti-government demonstrations in Tehran.

 

The United States has been waging a campaign against Huawei, which it has warned could spy on customers for Beijing. Washington placed the company on a trade blacklist last year, citing national security concerns.

 

The indictment is "part of an attempt to irrevocably damage Huawei's reputation and its business for reasons related to competition rather than law enforcement," Huawei said in a statement.

 

It called the racketeering accusation "a contrived repackaging of a handful of civil allegations that are almost 20 years old."

 

Huawei pleaded not guilty to the earlier indictment unsealed against the company in January 2019, which charged it with bank and wire fraud, violating sanctions against Iran, and obstructing justice.

 

Its chief financial officer Meng Wanzhou was arrested in December 2018 in Canada on charges in that indictment, causing an uproar in China and a chill in Canadian-Chinese relations. She has said she is innocent and is fighting extradition.

 

There are no new charges against Meng in the superseding indictment.

 

NEW CHARGES

The new trade secret theft charges relate to internet router source code, cellular antenna technology, and robotics.

 

For example, beginning in 2000, Huawei and its subsidiary Futurewei Technologies Inc are accused of misappropriating operating system source code for internet routers, commands used to communicate with the routers, and operating system manuals, from a company in Northern California. Futurewei was added as a defendant in the latest indictment.

 

Huawei then sold their routers in the United States as lower cost versions of the U.S. company's products, the indictment says.

 

Although the U.S. company is not identified, Cisco Systems <CSCO.O> sued Huawei in Texas in 2003 over copyright infringement related to its routers.

 

Huawei is also accused of recruiting employees from other companies, making efforts to get intellectual property from those companies, and using professors at research institutions to obtain technology.

 

"The indictment paints a damning portrait of an illegitimate organisation that lacks any regard for the law," U.S. Senate Intelligence Committee chairman Richard Burr and vice chairman Mark Warner said in a joint statement.

 

The Republican and Democratic Senators called it "an important step in combating Huawei's state-directed and criminal enterprise."

 

The indictment also accuses Meng and Huawei of conspiring to defraud HSBC and other banks by misrepresenting Huawei's relationship with a company that operated in Iran.

 

It references reporting by Reuters from seven years ago about Huawei's ties to Skycom Tech Co Ltd, which offered to sell U.S. origin goods to Iran, in violation of U.S. law. It also mentions news reports in Reuters and the Wall Street Journal that claimed Huawei assisted the government of Iran in domestic surveillance. reut.rs/2sUq8RT

 

In addition to accusing Huawei of lying about its operations in Iran, the latest indictment says Huawei falsely represented to banks that it had no business in North Korea.

 

The U.S. Commerce Department in May put Huawei on a trade blacklist that restricted U.S. suppliers from selling parts and components to the company.

 

On Thursday, in some positive news for the company, the Commerce Department announced it was extending a temporary general licence for 45 days allowing U.S. companies to continue doing some business with Huawei. The move is intended to maintain existing equipment and allow providers in rural communities more time to find alternatives to the company's networks.

 

At the same time, the United States is weighing new regulations to stop more foreign shipments of products with U.S. technology to Huawei.

 

And Washington has continued to pressure other countries to drop Huawei from their cellular networks over its claim the equipment could be used by Beijing for spying.

 

(Reporting by Karen Freifeld; additional reporting by Jonathan Stempel and David Shepardson; Editing by Rosalba O'Brien)

 

-- © Copyright Reuters 2020-02-14

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[owl sees all]

Desperate times for the (at the moment anyway) world's biggest economy. Clutching at straws comes to mind.

[Nyezhov]

42 minutes ago, owl sees all said:

Desperate times for the (at the moment anyway) world's biggest economy. Clutching at straws comes to mind.

That makes no sense at all.

[NanLaew]

1 hour ago, Nyezhov said:

2 hours ago, owl sees all said:

Desperate times for the (at the moment anyway) world's biggest economy. Clutching at straws comes to mind.

That makes no sense at all.

The timing of the unsealing of these new charges makes sense with Boris and the Brits recently saying they'll carry on integrating Huawei technology in their G5 rollout.

 

The sudden Iran connection is all a wee bit too convenient IMHO. However, if they make that one stick, it's curtains for Huawei... maybe.

[Nyezhov]

3 minutes ago, NanLaew said:

The timing of the unsealing of these new charges makes sense with Boris and the Brits recently saying they'll carry on integrating Huawei technology in their G5 rollout.

I hate to be an arrogant American d**k, but Boris will do what he is told. Huaweii is a problem. And we all know that China, as a nation, has a policy of stealing and skirting the rules. Regardless,.....

 

Clearly, the US has something on Huaweii otherwise there would not be the indictment.  the burden of proof is Guilt Beyond a Reasonable Doubt, so unless the case is strong, the US looks the fool. If its proven though.......

 

[Isaan sailor]

China plays by its own rules.  And unfortunately it seeks to control or colonise all of SE Asia.  We can only hope the regime in Bangkok comes to its senses and starts treating China like the aggressive competitor it has become.  Besides filling empty condos or hotel rooms, and some mass market restaurants, and 7/11s I don’t see much in it for Thailand...

[stevenl]

So what happened and was the result of the 2003!! courtcase?

[Eric Loh]

Accusation and allegation are what US got. What about some evidence. 

[ChouDoufu]

On 2/14/2020 at 10:50 AM, Nyezhov said:

I hate to be an arrogant American d**k, but Boris will do what he is told. Huaweii is a problem. And we all know that China, as a nation, has a policy of stealing and skirting the rules. Regardless,.....

 

Clearly, the US has something on Huaweii otherwise there would not be the indictment.  the burden of proof is Guilt Beyond a Reasonable Doubt, so unless the case is strong, the US looks the fool. If its proven though.......

 

not necessarily.  it's all about image and controlling the narrative.  get the accusations out to the media, they'll run with it, and it gets ingrained in the public consciousness.  repeat it enough times and it becomes "fact."

 

we've got a long history of making allegations, based on conveniently "secret" evidence.

 

we've also got a history of indicting ham sammiches, assuming the sammich would never dare show in court, giving our politicians cover to make more claims.  of course, when they do show for trial, it's endless delays and refusals to prosecute.

[sucit]

On 2/14/2020 at 9:50 AM, Nyezhov said:

I hate to be an arrogant American d**k, but Boris will do what he is told. Huaweii is a problem. And we all know that China, as a nation, has a policy of stealing and skirting the rules. Regardless,.....

 

Clearly, the US has something on Huaweii otherwise there would not be the indictment.  the burden of proof is Guilt Beyond a Reasonable Doubt, so unless the case is strong, the US looks the fool. If its proven though.......

 

Have you been in a cave the last 50 years? 

 

"Clearly the US has something"? 

 

This is what they do. J Assange is a perfect example, Soleimani killing another recent one, Iraq war yet another. They just make <deleted> up when they don't like something. 

 

They do this all the time and just use their petro dollar and other leverage to ever be held accountable. Open your eyes man. 

[sucit]

13 minutes ago, ChouDoufu said:

not necessarily.  it's all about image and controlling the narrative.  get the accusations out to the media, they'll run with it, and it gets ingrained in the public consciousness.  repeat it enough times and it becomes "fact."

 

we've got a long history of making allegations, based on conveniently "secret" evidence.

 

we've also got a history of indicting ham sammiches, assuming the sammich would never dare show in court, giving our politicians cover to make more claims.  of course, when they do show for trial, it's endless delays and refusals to prosecute.

I do not think "not necessarily" is even the right phrase. 

 

If you had a kid who lied and manipulated as often as the US, you'd of course need to see undeniable proof of the assertions. 

 

Until we see that, what they say means less than nothing. In fact, we know it is most likely a lie. 

[Chomper Higgot]

Whenever the US asserts intellectual property rights in a dispute it’s worth revisiting the case history.  

 

The Charles Dickens v the US is a good place to start.

[tgw]

Huawei is a huge problem for the USA because it would be a huge problem to install spy chips on that equipment before it is delivered to clients. It would basically mean 5G networks would go dark for the NSA. Also tells a lot about the security of existing networks.

 

Stolen secrets or not, the case about the woman is very petty and reeks of accusations made in bad faith.

 

The last statement " And Washington has continued to pressure other countries to drop Huawei from their cellular networks over its claim the equipment could be used by Beijing for spying. "

is particularly hilarious when one knows what the NSA does to network equipment about to be delivered to international clients...