Huawei Calls U.S. Ban on its 5G Gear a `Dangerous Precedent'

(Bloomberg) -- Huawei Technologies Co. has asked a U.S. judge to rule that a ban on federal agencies and contractors buying its gear violates the constitution, delivering its latest legal riposte to American accusations it aids Beijing in espionage.

China’s largest technology company asked for summary judgment in a filing late Tuesday, arguing the moratorium on its equipment disrupts existing contracts, stigmatizes Huawei and its employees as “tools” of the Chinese government, and threatens its ability to do business in the U.S. Huawei, which has warned that the ban could kill the company, has repeatedly denied those allegations.

Huawei finds itself in the cross-hairs of the U.S. government just as countries around the world prepare to spend billions on potentially revolutionary fifth-generation wireless technology. The Trump administration has also blacklisted the Chinese company, cutting off the supply of American components it needs to make its smartphones and networking gear.

In challenging the ban, Huawei argues it’s unconstitutional to single out a person or a group for penalty without a fair trial. It’s taking aim at a provision in the 2019 National Defense Authorization Act that bars any executive agency, government contractor or company that receives a government loan or grant from using Huawei equipment, according to its complaint. The Chinese company argues that the provision is a bill of attainder, a legislative punishment without trial that’s prohibited by the U.S. Constitution.

The ban “adjudicates Huawei to be a tool of the Chinese government, imposes vast restrictions on it, and burdens its constitutional rights,” Huawei said in its filing. “In doing so, it tries to drive Huawei out of the country, defames it as disloyal and untrustworthy, and denies it the administrative and judicial process available to others to contest such charges.”

Huawei’s lawsuit signals a more aggressive response from the company toward its U.S. accusers, who have been trying to persuade other countries to ban Huawei gear.

Banning the company “will do nothing to make networks more secure. They provide a false sense of security, and distract attention from the real challenges we face,” Song Liuping, Huawei’s chief legal officer, said in a statement repeating arguments laid out this week in a Wall Street Journal opinion piece. “This sets a dangerous precedent. Today it’s telecoms and Huawei. Tomorrow it could be your industry, your company, your consumers.”

The case is Huawei Technologies v. U.S., 4:19-cv-00159, U.S. District Court, Eastern District of Texas (Sherman).