Tuesday, January 25, 2011, 1/25/2011 09:22:00 AM

Shoe Meets Other Foot: Chinese Firm Huawei Sues Motorola Alleging Trade Secret Theft

By Todd

The Washington Post is reporting that Chinese tech giant Huawei has filed a federal civil action against Motorola in Chicago alleging trade secret misappropriation against the latter company.


The case concerns the announcement last year that Motorola was going to sell its main mobile telecommunications unit to Nokia Siemens Networks. In a complaint filed Monday in federal court in Chicago, Huawei alleged that it had provided Motorola with $878 million worth of equipment and technology for wireless networks - including routers and switching stations - that Huawei had developed since 2000.


Huawei further alleged that the technology was about to be handed over to Nokia Siemens, which announced plans last year to buy Motorola's networking equipment business for $1.2 billion. The complaint asked the court to stop the transfer because it would result in "irreparable harm" to Huawei as Nokia and Huawei compete across the globe.


The theft of Western intellectual property has long been a major issue between the West and China. It figured prominently in the recent summit between President Obama and Chinese President Hu Jintao, during which China agreed to do a better job protecting U.S. software against piracy.

Motorola sued Huawei last year, alleging that Huawei had obtained restricted Motorola technology after some Motorola employees set up a dummy corporation that was used to funnel trade secrets to Huawei. In 2004, computer networks firm Cisco sued Huawei for allegedly using Cisco's computer code in Huawei's products. Cisco dropped the suit after Huawei agreed to make changes in its products.


We'll keep an eye on this one for you.

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