T-Mobile is at the center of the DOJ’s allegations against Huawei

Huawei
(Questex)

The U.S. Department of Justice on Monday laid out a 10-count indictment charging Huawei with theft of trade secrets from T-Mobile. A separate indictment also accuses Huawei of wire fraud and obstruction of justice.

The first indictment unsealed on Monday claims that telecom equipment vendor Huawei stole trade secrets from Bellevue, Washington-based T-Mobile USA and then obstructed justice when T-Mobile threatened to sue Huawei in U.S. District Court in Seattle. The alleged conduct described in the indictment occurred from 2012 to 2014 and includes an internal Huawei announcement that the company was offering bonuses to employees who succeeded in stealing confidential information from other companies.

According to the indictment, in 2012 Huawei began a concerted effort to steal information on a T-Mobile phone-testing robot dubbed “Tappy.” In an effort to build their own robot to test phones before they were shipped to T-Mobile and other wireless carriers, Huawei engineers allegedly violated confidentiality and nondisclosure agreements with T-Mobile by secretly taking photos of “Tappy,” taking measurements of parts of the robot, and in one instance stealing a piece of the robot so that the Huawei engineers in China could try to replicate it.

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The indictment also claims that after T-Mobile discovered and interrupted these activities and then sued in 2014, Huawei produced a report falsely claiming that the theft was the work of rogue actors within the company and not a concerted effort by Huawei. The indictment says that emails obtained in the course of the investigation reveal the conspiracy to steal secrets from T-Mobile was a companywide effort involving many engineers and employees.

As part of the investigation into Huawei, the FBI says it obtained emails revealing that in July 2013, Huawei offered bonuses to employees based on the value of information they stole from companies around the world.

A separate 13-count indictment charged Huawei, as well as its CFO Meng Wanzhou, with using a shell company Skycom to commit bank fraud, wire fraud and money laundering.

Huawei’s CFO has been held under house arrest in Vancouver, Canada, since early December 2018 at the request of the United States.

U.S. Department of Homeland Security Secretary Kirstjen Nielsen said in a statement Monday that Huawei and its CFO “willfully conducted millions of dollars in transactions that were in direct violation of the Iranian Transactions and Sanctions Regulations.”

Acting Attorney General Matthew Whitaker confirmed during a press conference Monday that the Justice Department will file extradition documentation for Meng from Canada by a Jan. 30 deadline.

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