American Court Determines Huawei Stole Trade Secrets from a Silicon Valley Startup

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The last couple of weeks have been marked by developments that largely affect Chinese corporation Huawei. The company, which, prior to the highly publicized U.S. ban, had sold millions of devices and grown its trade in the telecoms industry, is undergoing a difficult time, although the outcome of this trade war cannot be predicted conclusively, at least for now.

Huawei has for a long term posed ‘threats’ to the United States if words by the nation’s President that ‘Huawei is very dangerous’ are anything to go by. The U.S. has been lobbying against the use Huawei technologies among its allies, not to mention its major move that barred American companies from conducting any business with Huawei.

The U.S.’s Department of Commerce instructed companies such as Google to cut business ties with the manufacturer, a move that has since sent shock waves across the mobile telephony market. It has gotten so bad that shipping companies such as FedEx have reported interference from the U.S., where it is not supposed to deliver products affiliated to Huawei in the U.S.



Part of the North America nation’s argument regarding the ban is that Huawei participates in dangerous activities, such as stealing trade secrets from American companies. This accusation, at least for a single case, was supported by a ruling in Texas where it a court established that Huawei did steal trade technologies from a Silicon Valley startup called Cnex Labs Inc.

Huawei’s defence argued that Cnex’s founder, who had previously worked for Huawei before he started the company actually stole Huawei technology. The case, which is not linked to Huawei’s tussle with the U.S., was overseen by a judge who will also examine manage its case against the government of the Unites States where the corporation faults its ban as unconstitutional.


Back to Cynex. The company, which has seen investments from the likes of Microsoft and Dell, specializes in solid state drives that are used by modern devices. Its products are reportedly faster, reliable and robust. According to Huawei, Cynex’s founder started the firm days after leaving Huawei, and started filing patents that are usually developed over an extended period. Huawei argued that the patents were based on works done by the founder while he was their employee. Other issues include cases where the founder apparently poached Huawei employees, and an instance where he was allegedly caught downloading confidential Huawei materials.

While the case was ruled against Huawei as it has been caught trying to reverse engineer Cnex technologies, the court found out that the corporation did not reap any benefits from the theft, hence did not slap it with any fines.

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