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Blacklisted Chinese firms eye lawsuits after Xiaomi win against Trump ban

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Karen Freifeld and Alexandra Alper, Reuters

<div class="embed-wrap"><figure data-feedback="fb:likes,fb:comments"><img src="https://sa.kapamilya.com/absnews/abscbnnews/media/2020/reuters/12/02/china-india-trade.jpg"/><figcaption>FILE PHOTO: People are silhouetted in front of Xiaomi&#x27;s logo at a venue in Beijing, May 10, 2016. <em>Kim Kyung-Hoon, Reuters file photo</em></figcaption></figure></div><p>Chinese companies targeted by a sweeping investment ban imposed by former President Donald Trump are considering suing the US government after a federal judge on Friday suspended a similar blacklisting for Beijing-based smartphone maker Xiaomi.</p><p>Lawyers familiar with the matter said some of the banned Chinese companies are in talks with law firms including Steptoe &amp; Johnson and Hogan Lovells, emboldened by US District Judge Rudolph Contreras&#x27; preliminary order halting Xiaomi&#x27;s inclusion on a US list of alleged Communist Chinese military companies that are subject to an investment ban.</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/03/15/21/chinas-xiaomi-soars-as-us-judge-lifts-it-from-backlist">China&#x27;s Xiaomi soars as US judge lifts it from backlist</a></li></ul><p>The Trump administration&#x27;s move to blacklist Xiaomi Corp, which knocked $10 billion off its market share and sent its shares down 9.5 percent in January, would have forced investors to completely divest their stakes in the company.</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/overseas/01/15/21/us-imposes-sanctions-on-chinese-officials-oil-giant-over-south-china-sea-coercion">US imposes sanctions on Chinese officials, oil giant over South China Sea &#x27;coercion&#x27;</a></li>	<li><a href="https://news.abs-cbn.com/business/12/19/20/us-blacklists-chinese-companies-including-chip-giant-smic">US blacklists Chinese companies including chip giant SMIC</a></li></ul><p>&quot;Companies are reaching out to lawyers to challenge the listings and the grounds for the listings,&quot; said Wendy Wysong, managing partner of the Hong Kong office of Steptoe &amp; Johnson, a worldwide law firm headquartered in Washington. Wysong and a person familiar with Hogan Lovells, another global law firm, declined to name the companies involved in discussions.</p><ul class="op-related-articles">	<li><a href="https://news.abs-cbn.com/business/01/30/21/xiaomi-sues-in-us-court-to-overturn-trumps-ban-on-investing-in-worlds-3rd-largest-smartphone-maker">Xiaomi sues in US court to overturn Trump’s ban on investing in world’s 3rd-largest smartphone maker</a></li></ul><p>Contreras flagged the US government&#x27;s &quot;deeply flawed&quot; process for including the company in the investment ban, based on just two key criteria: its development of 5G technology and artificial intelligence, which the Defense Department alleges are &quot;essential to modern military operations,&quot; and an award given to Xiaomi founder and Chief Executive Lei Jun from an organization said to help the Chinese government eliminate barriers between commercial and military sectors.</p><p>The judge noted that 5G and AI technologies were fast becoming standard in consumer electronics, and that over 500 entrepreneurs had received the same award as Lei since 2004, including the leaders of an infant formula company.</p><p>&quot;The facts that led to Xiaomi&#x27;s designation are almost laughable, and I think it absolutely is going to lead to additional companies seeking relief,&quot; said Washington lawyer Brian Egan, a former legal adviser in both the White House and State Department who also works at Steptoe.</p><figure class="op-interactive"><iframe allow="autoplay; fullscreen" frameBorder="0" height="100%" id="ivsplayer01" scrolling="no" src="https://player.ivideosmart.com/ivsplayer/v4/dist/html/iframe-src.html?iframeid=ivsplayer01&amp;key=e8c22c015ca9eafa76f1e3edfa03c603&amp;spid=3001339&amp;vid=1641478" width="100%"></iframe></figure><div class="iwantbar">Watch more in <a href="//www.iwantv.com.ph/">iWantv</a> or <a href="//tfc.tv/">TFC.tv</a></div><div><strong>GOVERNMENT UNDECIDED ON PATH FORWARD</strong></div><p>In a joint filing on Tuesday, the government said it had not decided on the &quot;appropriate path forward&quot; in the Xiaomi case in light of the judge&#x27;s decision.</p><p>A spokeswoman for the US Department of Justice, which is defending the case, declined to comment. A spokeswoman for the Department of Defense referred questions to the White House, which has not responded.</p><p>Xiaomi and 43 other companies were added in the waning months of the Trump administration to the blacklist, which was mandated by a 1999 law requiring the Defense Department to publish a compilation of companies &quot;owned or controlled&quot; by the Chinese military.</p><p>Seeking to cement a tough line on China and box his Democratic successor, Joe Biden, into hardline policies, Trump signed an executive order that was later expanded to bar all US investors from holding securities in the named companies beginning on Nov. 11, 2021.</p><p>Other companies listed include video surveillance giant Hikvision, China National Offshore Oil Corp (CNOOC) and China&#x27;s top chipmaker, Semiconductor Manufacturing International Corp.</p><p>SMIC, Hikvision and CNOOC did not immediately respond to requests for comment.</p><p>Luokung Technology Corp, a mapping technology company on the list, also sued the US government earlier this month, and is expected to seek preliminary relief similar to that awarded to Xiaomi.</p>

<p>Chinese companies targeted by a sweeping investment ban imposed by former President Donald Trump are considering suing the US government after a federal judge on Friday suspended a similar blacklisting for Beijing-based smartphone maker Xiaomi.<br /> </p>

Chinese companies targeted by a sweeping investment ban imposed by former President Donald Trump are considering suing the US government after a federal judge on Friday suspended a similar blacklisting for Beijing-based smartphone maker Xiaomi.

Blacklisted Chinese firms eye lawsuits after Xiaomi win against Trump ban

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Blacklisted Chinese firms eye lawsuits after Xiaomi win against Trump ban

Karen Freifeld and Alexandra Alper,

Reuters

Published Mar 17, 2021 11:12 AM PHT

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