US prosecutor calls Huawei a criminal enterprise in opening trial statement

Key facts

• A U.S. prosecutor accused Huawei of being a criminal enterprise that stole from American companies.
• The government alleges Huawei conspired to steal trade secrets from five U.S. companies, including Cisco Systems and T-Mobile.
• Huawei's defense team stated the case is about competition and innovation, not criminal conduct.
• Prosecutors claim Huawei concealed its business in Iran to launder U.S. dollars and assist in spying.
• The defense argued that Huawei was unaware its financial dealings violated U.S. sanctions law.
• The trial is expected to last three months.

In Brooklyn federal court, the U.S. government has opened its trial against Chinese telecommunications giant Huawei, accusing the company of operating as a criminal enterprise for two decades. Prosecutor Taylor Stout alleged that Huawei engaged in theft and deception to steal trade secrets from at least five American companies, including Cisco Systems and T-Mobile, to gain a competitive edge and dominate the global telecommunications industry.

Stout told jurors the government would present evidence of Huawei "red-handed trying to steal American tech," including video footage of an employee stealing a robotic arm from T-Mobile and source code from Cisco. The prosecution also accused Huawei of concealing its business activities in Iran to launder U.S. dollars and facilitate spying by the Iranian government.

Huawei's defense team, led by Brian Heberlig, presented a contrasting narrative, arguing that the company's success was a result of competition and innovation, not criminal conduct. Heberlig contended that the incidents cited by the prosecution were isolated actions by individual employees, not part of an overarching conspiracy, and that management took steps to rectify issues upon learning of them. The defense also stated there was no evidence Huawei knew its dollar-clearing activities would violate U.S. sanctions law, and that banks involved were aware of its business in Iran.

The case against Huawei originated in 2018 with charges of bank fraud and sanctions violations. It has since expanded to include racketeering. The trial is expected to last three months, and admissions made by former CFO Meng Wanzhou, who was detained in 2018 and later released under a deferred prosecution agreement, are set to be introduced as evidence.