A US prosecutor has described Chinese telecommunications giant Huawei as a criminal enterprise that stole technology from American companies to build its global telecommunications business, as its trial opened in a federal court in Brooklyn on Wednesday.
” The government alleges a pattern of theft, deception and concealment,” Taylor Stout, a trial attorney with the US Department of Justice, said in the government’s opening statement.
Stout told jurors that Huawei had spent two decades victimising American companies and abusing the US financial system in an effort to dominate the global telecommunications industry.
US alleges theft of American technology
Prosecutors allege that Huawei conspired to steal trade secrets from five US companies, including operating system source code for internet routers from Cisco Systems and a robotic arm used to test phones by T-Mobile.
The alleged thefts were intended to give Huawei an unfair competitive advantage and help expand its business, Stout told jurors.
“We’ll hear from people who caught Huawei red-handed trying to steal American tech,” he said, adding that there was video showing an employee stealing the robotic arm.
Huawei’s defence team presented a sharply different account of the company’s rise and business practices.
“It’s about competition, not conspiracy. Innovation, not theft. Ordinary business dealings, not criminal conduct,” Brian Heberlig, one of the lawyers representing Huawei, said in his opening statement.
“Huawei earned its success. There was no blueprint for crime,” he added.
Huawei is known for telecommunications equipment and mobile phones and, in recent years, has also expanded into AI chips.
The company operates globally, but its networking equipment is restricted in the US. Suppliers are also barred from exporting US goods and technology to Huawei without approval from the US Department of Commerce.
Defence accuses prosecutors of cherry-picking incidents
The case against Huawei began in 2018, when the company and its chief financial officer were indicted on bank fraud and sanctions violations charges.
Prosecutors alleged that Huawei misrepresented its business in Iran to circumvent US sanctions and move millions of dollars through the US financial system.
The case subsequently expanded into a broader indictment that includes racketeering, referring to a pattern of illegal activity carried out by an enterprise to generate profit.
Heberlig told jurors that prosecutors would portray routine activities by global technology companies as criminal conduct by twisting ordinary business practices.
He accused the government of “cherry-picking isolated events” that should not be treated as evidence of an overarching conspiracy that, he said, never existed.
Heberlig said the incidents involving Cisco and T-Mobile were actions by individual employees and that Huawei management took steps to address them after learning about them.
He also described an incident in which an employee took unauthorised photographs of a Fujitsu networking device at a trade show as a “foolish act” by an individual employee who was “promptly fired”.
The prosecution also accused Huawei of concealing the nature of its operations in Iran so it could move US dollars through the financial system and assist the Iranian government in spying on its citizens.
The defence argued that there was no evidence Huawei knew the dollar-clearing arrangements would violate US sanctions law. Heberlig also said the company could have conducted the transactions outside the US or in another currency.
He further argued that the banks allegedly misled by Huawei were aware of the company’s business in Iran and continued to compete for its business.
Meng Wanzhou case linked to original indictment
In 2018, Huawei’s chief financial officer, Meng Wanzhou, was detained in Vancouver after being arrested on a US warrant linked to the original indictment.
She fought extradition for nearly three years before being allowed to return to China under a diplomatic agreement involving the US, China and Canada.
The charges against Meng were dismissed in 2022 as part of a deferred prosecution agreement.
However, admissions she made are expected to be introduced as evidence during the Huawei trial, which is expected to last three months.
