Huawei opens lawsuit for Texas trade secrets amid allegations of espionage

(Reuters) – Huawei Technologies, the Chinese supplier of telecommunications equipment opposing a ban on sales in the United States, opened on Monday in the United States a lawsuit for trade secrets against a former employee who wanted turn the file into a referendum on Huawei's behavior.

The lawsuit, which includes salacious accusations of corporate espionage, racketeering and a secret database on its rivals' technology, will promise to keep Huawei in the spotlight in the middle of the day. An American blacklist and pressure urging its allies not to buy its network equipment for security reasons.

The jury selection begins Monday in federal court in Sherman, Texas, and the trial is expected to last about three weeks. The judge in the case, Amos Mazzant, also hears separately from Huawei's proposal to overturn the Trump administration's ban on selling its products to government agencies and subcontractors.

Huawei's lawsuit against former employee Ronnie Huang and his new company, CNEX Labs Inc., alleges that the former director allegedly "illegally used racketeering" to steal his technology and poach his staff, according to court documents. CNEX develops chips that accelerate data storage on cloud computing networks.

Huang denies having committed wrongdoing and filed a lawsuit, alleging that Huawei was using US courts to acquire its technology and that of other users and to crush its rivals.

Huawei is demanding "tens of millions of dollars" in damages for about 30 CNEX trade secrets and patents, according to a spokesman for the Chinese technology company. Among Huawei's claims, another Huawei employee allegedly downloaded some of his secrets before joining CNEX.

"Huawei has been a stepping stone for (Huang) succeed where it could not have been otherwise," said the spokesman. The case has nothing to do with tensions on the blacklist of the United States, he said. "This is not a case opposing the United States to China," the spokesman said.

Huang started CNEX in 2013 and has raised more than $ 100 million from donors, including subsidiaries of Dell Technologies and Microsoft.

A Huawei official posing as a potential buyer and the company used links with a Chinese university to access CNEX designs, according to Huang's project. Among his accusations: Huawei rewarded the staff for stealing the trade secrets of his rivals and stored the stolen technology in a secret database for use.

"(Huawei) is a vast competition intelligence gathering operation, bringing together the intellectual property and trade secrets of the world's largest technology companies," said Matthew Goss, CNEX's General Counsel, during an interview .

According to Goss, Huawei's lawsuit, which includes one of the first claims to be heard under the US 2016 Trade Secrets Act, was "an arsenal of our courts against US corporations."