US officials accused Huawei of facilitating Chinese spying. Bloomberg reported Huawei employees worked on at least 10 research projects with Chinese armed forces, collaborations the company said it was not aware of.

People are seen in front of a Huawei logo at the Consumer Electronics Show (CES) Asia 2019 in Shanghai, China on June 12, 2019.
People are seen in front of a Huawei logo at the Consumer Electronics Show (CES) Asia 2019 in Shanghai, China on June 12, 2019. (Reuters)

Chinese tech giant Huawei warned on Thursday a US senator's proposal to block the company from pursuing damages in US patent courts would be a "catastrophe for global innovation."

The proposal comes amid mounting US action against Huawei, the biggest maker of switching gear for phone carriers. The company has been devastated by the Trump administration's decision to impose restrictions on its access to American chips for smartphones and other components and technology.

Disrupting Huawei's access to US patent courts would threaten the intellectual property system that supports technology development, said Song Liping, the company's chief legal officer.

The foundations of IP protection

The proposal by Senator Marco Rubio, a Republican from Florida, followed reports that Huawei Technologies Ltd is asking for $1 billion from American phone carrier Verizon for use of the Chinese company's patents.

"If such a legislative proposal were to be passed, it would be a catastrophe for global innovation. It would have terrible consequences," Song said at a news conference. He said it would "break the foundation of IP protection."

American officials accuse Huawei of facilitating Chinese spying, a charge the company denies, and see it as a growing competitive threat to US technology industries.

Huawei's founder, Ren Zhengfei, said this month it has cut its project sales by $30 billion over the next two years due to curbs on access to American chips and other components. He said smartphone sales outside China will fall 40 percent.

Huawei's US sales of network gear evaporated after a congressional panel labelled the company a security threat in 2012 and told phone carriers to avoid it. But the Chinese company has a patent portfolio it licences to manufacturers and carriers.

Song gave no confirmation of how much Huawei wants from Verizon or the basis of its claims.

"We aren't taking an aggressive approach to intellectual property rights," Song said. "We aim to protect our IP in order to safeguard our global business and we have no intention of weaponising IP. We are against charging exorbitant royalties, and we think that the fees should be within reasonable realms."

Huawei, founded in 1986, has China's biggest corporate research and development budget at $15 billion in 2018. The company is a leader in developing next-generation telecoms technology.

On Wednesday, a US federal court jury in Texas ruled Huawei stole trade secrets from a Silicon Valley company but awarded no damages, saying the Chinese company didn't benefit.

The jury rejected Huawei's claims that Cnex Labs Inc. co-founder Yiren Huang stole its technology while he worked at a Huawei subsidiary.

Huawei's head of intellectual property, Jason Ding, said the company was studying the verdict and deciding what to do next.

Alleged collaboration with China military - Bloomberg

Bloomberg reported that Huawei employees worked on at least 10 research projects with Chinese armed forces personnel over the past decade, collaborations the Chinese company said it was not aware of.

Huawei workers teamed up with members of various organs of China's People's Liberation Army (PLA) in projects spanning artificial intelligence to radio communications, the news outlet said. 

"Huawei is not aware of its employees publishing research papers in their individual capacity," Huawei spokesman Joe Kelly said. Kelly added the company does not have any research and development collaboration or partnerships with PLA-affiliated institutions.

"Huawei only develops and produces communications products that conform to civil standards worldwide, and does not customise R&D products for the military."

The research projects are part of a few publicly disclosed studies, Bloomberg said, adding it culled the papers from published periodicals and online research databases used mainly by Chinese academics and industry specialists. 

Source: AP