Huawei warns US patent curbs would hurt global tech

SHENZHEN, China (AP) – Chinese tech giant Huawei warned yesterday a United States (US) senator’s proposal to block the company from pursuing damages in 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 company’s Chief Legal Officer Song Liping.

The proposal by Senator Marco Rubio, a Republican from Florida, followed reports Huawei Technologies Ltd is asking for USD1 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 Chief Legal Officer Song Liuping speaks at a press conference at the company’s headquarters in Shenzhen. – AP

Huawei’s founder Ren Zhengfei said this month it has cut its project sales by USD30 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 per cent.

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 licenses 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 USD15 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.