Chinese tech giant Huawei Technologies went on trial on Tuesday in Brooklyn, New York, on criminal charges after eight years of legal wrangling with the US government.
The Shenzhen-based company has pleaded not guilty to all 14 counts, including bank fraud, wire fraud, trade secret theft, and racketeering, with the alleged criminal activity dating back to 1999.
Jury selection began on Tuesday, local time, with US District Judge Ann M. Donnelly of the Eastern District of New York instructing potential jurors to strive to be as “fair and impartial” as possible.
“China and the Communist Party ... are not on trial,” she said, also noting that the ongoing US-Iran conflict should not influence jurors’ judgment.
Federal prosecutors said in court documents filed with the Eastern District of New York that Huawei carried out a decades-long racketeering scheme to grow its worldwide business.
They accuse it of engaging in intellectual property theft, violations of US sanctions on Iran and deceiving major banks about its Iran ties, all of which the company denies.
Huawei said in a statement that the US government’s “overarching narrative is demonstrably false” and that the company’s recent successes, including US$126 billion in global sales revenue last year, its best performance in nearly five years, were achieved through its own research and development efforts.
“Long-term investment in innovation, backed by the utmost respect for intellectual property, has been the driving force behind Huawei’s business success,” a Huawei spokesperson said.
On September 4, the prosecutors dropped two counts of sanctions violations, according to a pre-trial filing, while proceeding with the remaining 12. If convicted, Huawei faces fines and forfeiture of proceeds gained during the alleged criminal activity, potentially one of the biggest ever US corporate fines.
The US government first charged Huawei in 2019 during the first Trump administration, when Huawei chief financial officer Meng Wanzhou was accused of misrepresenting Huawei’s relationship with Skycom Technologies, a Hong Kong corporation that provided telecoms infrastructure and services in Iran.
The indictment sparked a years-long effort by the US government to extradite Meng from Canada, where she was arrested, causing a sharp downturn in both China-US and China-Canada relations.
Meng’s legal case concluded in 2021 when she admitted to lying to US financial institutions about Huawei’s business activities in Iran, as part of a deal with the US government that saw it drop its extradition request and allow Meng to return to China.
In June, Judge Donnelly ruled that Meng’s admission could be used as evidence in the coming trial after Huawei’s lawyers sought to have it excluded.
Prosecutors said that they have sought to call 25 China-based Huawei employees, including Meng, the daughter of Huawei founder Ren Zhengfei, to testify at the trial.
Huawei is being represented by US law firms Jenner & Block, Sidley Austin and Steptoe.
Margaret Lewis, a law professor at Seton Hall University, said that the complexity of the case means that the prosecution is likely to “take some time” to get its points across to jurors.
“This case is unusual in that the charges span ... close to a decade,” she said. “And the factual allegations underlying the case span more than a quarter century.”
Nick Turner, a Washington-based partner at Akrivis Law Group, said that the two parties could still reach a settlement during the trial. “It is atypical for large companies to fight all the way to trial,” he said.
Prosecutors and Huawei previously engaged in settlement negotiations, but they reached an “impasse”, according to a US Department of Justice filing with the court in 2024.
Founded in 1987, Huawei has grown to become the world’s biggest telecoms equipment maker and a major smartphone manufacturer.
The company was added to the US trade sanctions Entity List in 2019, which restricted its access to cutting-edge American technology.
However, the company has emerged in recent years as a central player in China’s tech industry, including artificial intelligence, where it is a key software and hardware provider with its Ascend semiconductor chips and Compute Architecture for Neural Networks (CANN) open-source ecosystem.
The prosecution told the court on Tuesday that it expected to conclude its case by November, while the defence said it would need around a month. -- SOUTH CHINA MORNING POST
