Update: Huawei Business Litigation in Texas Courts
An important business dispute was recently decided in the Eastern District of Texas after a 17 day jury trial and both companies receiving nothing in terms of damages. Chinese tech company Huawei Technologies Co. and Texas subsidiary Futurewei Technologies Inc. sued Yiren Ronnie Huang and his company CNEX Labs Inc. (which also filed a counterclaim), alleging that Huang–once an employee of Futurewei–stole plaintiffs’ trade secrets and intellectual property in order to develop competing products and start his own business. In its counterclaim, CNEX argued that plaintiffs conspired to obtain his own trade secrets for research.
Meanwhile, Huawei’s broader legal challenge concerning limitations included in the U.S.’s National Defense Authorization Act is still pending, as we discuss below:
Huawei Technologies Co. Ltd. V. Huang
In Huawei Technologies Co. Ltd. V. Huang, ultimately, the jury decided that Futurewei failed to prove that Huang breached an employment agreement’s confidential information provisions. While the jury did find that Huang breached the patent application disclosure provision within the agreement, and also found that this did not actually cause any harm to Futurewei and, therefore, damages were not necessary to award. The jury also found that Futurewei failed to prove that CNEX interfered with any employment agreements between Huang and Futurewei. Regarding the counterclaim, the jury found that Huawei did misappropriate CNEX’s trade secrets, but Futurewei did not, and this did not cause any company to be unjustly enriched.
Huawei’s Challenge of The 2019 Defense Authorization Act
Meanwhile, Huawei has also brought a legal challenge regarding American limits on purchasing its equipment; also in a federal court here in Texas. The lawsuit challenges a provision of U.S.’s 2019 Defense Authorization Act, which bars U.S. government agencies from contracting with companies like Huawei that provide equipment. Huawei is also arguing that the U.S. increasingly placing limitations on the ability for consumers to purchase Huawei’s equipment is hurting the actual consumer. The lawsuit could ultimately result in the U.S. government obtaining information about the company’s business practices and technology via the discovery process and, as a result, Huawei is seeking to bring the lawsuit to a conclusion in an effort to avoid discovery altogether. The discovery process can be deadly to companies like Huawei due to how invasive and time consuming it tends to be.
Contact Our Texas Commercial Litigation Attorneys
When business disputes arise and litigation is necessary, it is essential that you work with a law firm that you can rely on, as the future of that business could depend upon the outcome. Contact our Brownsville commercial litigation attorneys at Colvin, Saenz, Rodriguez & Kennamer, L.L.P. today to find out about the more than sixty years’ experience we have representing companies of all sizes here in Texas.
Resources:
nytimes.com/2019/05/29/business/huawei-us-lawsuit.html
law.com/texaslawyer/2019/06/27/huawei-litigation-ends-in-take-nothing-judgment-for-both-sides/
