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Huawei sues, and loses trade secrets case to U.S. chip designer

Amidst their case to overturn their U.S. ban, Huawei has just lost a case against semiconductor designer CNEX Labs, based in California. The Chinese tech giants brought a lawsuit against CNEX for stealing trade secrets—its co-founder Yiren “Ronnie” Huang was a former exec in Huawei and allegedly breached his previous employment contract and failed to notify Huawei of any patents he registered within 1 year of leaving the company.

Huawei’s claim is basically for misappropriation of trade secrets involving memory control technology and poaching of its employees by Huang. In response, CNEX also filed a counterclaim against Huawei for stealing its technology by posing as a customer, and reportedly alleged that the Chinese tech company’s original claim is merely a technique to obtain other firm’s trade secrets.

“Bullying & intimidation”

Interestingly, the case was heard before the same U.S. District Court Judge that is presiding over their bid to overturn the Trump administration’s ban against governmental agencies from buying Huawei equipment and American companies from doing business with Huawei.

Ultimately, the court ruled that Ronnie Huang breached his employment contract with Huawei, but no damages were awarded to Huawei. In addition to that, CNEX was not awarded any damages for their counterclaim either; this was due to the fact that the technology is not drawing any revenue.

Huawei’s Vice President for risk management revealed that they are considering their next moves, calling the verdict “mixed” and explaining the Chinese firm’s disappointment at the results.

On the flipside, CNEX feels that this is part of a pattern that Huawei is showing—according to a CNEX spokesman, the lawsuit was simply part of a move by Huawei to attain CNEX’s advanced semiconductor technology. In line with that, CNEX’s attorney was firm when he described the lawsuit as “bullying and intimidation”.

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[ VIA ]