A US judge has dismissed a lawsuit brought by Huawei challenging a federal ban that prevents government personnel from using the company’s devices.
Huawei originally filed the suit in 2018, arguing that the ban was unconstitutional. Since then, the company has faced growing scrutiny led by the United States and echoed by some allies, on the basis of concerns that Huawei may be influenced by the Chinese government—an allegation the company rejects.
In his ruling, US District Court Judge Amos Mazzant upheld Congress’s authority to prohibit federal agencies from using equipment produced by specified companies. In a 57-page opinion issued on Tuesday, Judge Mazzant wrote, “Contracting with the federal government is a privilege, not a constitutionally guaranteed right—at least not as far as this court is aware.”
Huawei said it is reviewing its legal options. In a statement the company argued that the approach taken by the US government in the 2019 National Defense Authorization Act creates a false sense of protection while infringing on Huawei’s constitutional rights.
Another difficult month for Huawei
The ruling comes amid a broader series of legal and political challenges for Huawei. Earlier this month, the Department of Justice brought charges against Huawei and several subsidiaries, accusing them of racketeering and conspiring to steal trade secrets. Around the same time, a bipartisan US delegation raised concerns about Huawei at the Munich Security Conference.
Senior US officials have been outspoken. Secretary of State Mike Pompeo warned that Huawei and other companies with close ties to Beijing could act as “Trojan horses for Chinese intelligence.” Defense Secretary Mark Esper described what he called a “nefarious strategy” by China that leverages companies like Huawei. In Congress, House Speaker Nancy Pelosi warned that adopting Chinese telecommunications equipment could amount to “choosing autocracy over democracy” and risk placing state surveillance capabilities in the hands of foreign authorities.
February is normally a busy month for the telecommunications industry, centered on the Mobile World Congress in Barcelona, where firms showcase new products, negotiate deals, and network. This year MWC was canceled due to concerns about the spread of the coronavirus, removing a major platform for industry announcements and business development.
Not all developments have been negative for Huawei. Last month, the UK government announced that, following a comprehensive security review, the company would be permitted a limited role in the country’s 5G networks. That decision represented a partial reprieve amid the broader international debate.
Huawei will be hoping for fewer setbacks as the year progresses and for opportunities to rebuild commercial momentum while addressing security concerns raised by governments and regulators.
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