Chinese electronics manufacturer Huawei was targeted by a sting operation organized by the FBI during the 2019 iteration of Consumer Electronics Show which took place in Las Vegas early last month, a Monday report revealed.
The move was made in response to concerns raised by Akhan Semiconductor, an American startup from the Greater Chicago Area that recently celebrated the sixth anniversary of its establishment. The company provided Huawei with samples of its “Miraj Diamond Glass” technology in 2017 and later suspected the Shenzen-based conglomerate dissected and harvested the prototypes with the intentions of stealing them, having based those suspicions on the fact that the modules were returned in an extremely damaged state.
Glass, spying, and burgers
Akhan founder Adam Khan personally shared those concerns were communicated with the FBI and the investigation that followed led to last month’s sting in Las Vegas where authorities are understood to have been surveilling a burger joint. Mr. Khan and Akhan COO Carl Shurboff were subsequently helping the FBI collect evidence, with the majority of their related activities amounting to taping conversations with Huawei officials.
The tech at the center of the ordeal is advertised as being up to ten times more scratch-resistant and six times tougher (i.e. less likely to break) than Corning’s Gorilla Glass, a family of chemically strengthened protective glass modules for small- and medium-sized consumer electronics that remains an industry standard even after more than a decade on the market.
Akhan already confronted several Huawei officials with its concerns but was met with dismissal and evasion. The world’s largest telecom equipment vendor is supposedly still interested in the startup’s solutions, though that stance is likely to change should the two end up in the court of law over the matter.
Who isn’t crying “trade secret theft?”
While this is far from Huawei’s first rodeo in the world of intellectual property law and litigation, as evidenced by its troubled history, the company faced some massive tests in recent months; the latest news on that front came just last week after a federal court unsealed a 13-count indictment against Huawei, two of its subsidiaries, and its CFO Meng Wanzhou, also the daughter of its founder Ren Zhengfei.
Ms. Wanzhou is presently battling the DOJ’s extradition request and is exploring options for avoiding the scrutiny of the stateside judicial system. While she and Huawei’s satellites in question are accused of participating in an illegal banking scheme that defrauded banks and sought to provide the conglomerate with a method for circumventing the Commerce Department’s trade embargoes imposed on Iran.
The DOJ is also suspecting Huawei of stealing protected trade secrets from T-Mobile – those pertaining to its touchscreen experience testing robot Tappy, having said as much in its indictment. T-Mobile already sued the company over the matter several years back an while the case surprisingly didn’t end with a settlement, the wireless carrier also appeared to have been robbed of a clear-cut victory as it failed to prove Huawei engineers who infiltrated its labs stole components and sketched Tappy designs at the behest of the firm’s senior leadership.
Motive aside, the acts themselves are well-documented, to the point that some of the evidence already procured by government officials is ridiculously incriminating and spells really bad news for Huawei.