Department of Justice Charges Huawei with Racketeering

2020 hasn’t gone swimmingly for Huawei. First, the Coronavirus decimated their smartphone sales, and on Thursday, the US Department of Justice unveiled fresh criminal charges against the telecom giant, alleging trade secret theft and racketeering.

The trade secret allegation is nothing new – back in 2003, Cisco sued Huawei over copied source code (and text from user manuals), while Motorola sued the Shenzhen juggernaut in 2010, alleging they received trade secrets. And the newest 16-count indictment – which includes charges under the Racketeer Influenced and Corrupt Organizations Act (RICO) – accuses Huawei of improprieties as far back as 2000.

RICO, of course, is often employed against the mafia, putting Huawei in interesting company. Essentially, it charges the defendant with an ongoing criminal conspiracy, and if you’ve followed Huawei news, RICO should come as no surprise.

And it couldn’t come at a worse time, with the Coronavirus wreaking havoc on the global supply chain (and Chinese companies taking the brunt of it).

According to Counterpoint Research, China’s Q1 smartphone sales will dip by 20%, with Huawei getting hit especially hard since domestic sales account for 60% of its total smartphone business. So the latest DOJ indictments smash Huawei with impeccable timing.

And Huawei was typically defiant.

“The ‘racketeering enterprise’ that the government charged today is nothing more than a contrived repackaging of a handful of civil allegations that are almost 20 years old,” said the company.

Check out more here: https://www.wired.com/story/us-hits-huawei-new-charges-trade-secret-theft