Eight years after US prosecutors secretly charged Huawei Technologies with defrauding HSBC and other banks over its business dealings with Iran, the long-running criminal case is finally heading to trial in New York.
Jury selection began on Tuesday in federal court in Brooklyn, marking the latest stage in one of the US government’s earliest and most closely watched legal battles against a major Chinese technology company. Huawei faces allegations involving Iran, trade secrets, sanctions violations and other offences, all of which the company denies.
Prosecutors have accused Huawei of conspiring to steal trade secrets from five US technology companies and of using Skycom, a firm operating in Iran, to obtain embargoed US goods, technology and services. The company also faces allegations of violating US sanctions against Iran, money laundering, racketeering, wire fraud and obstruction.
The indictment covers alleged wrongdoing between about 1999 and 2020. It also accuses Huawei of lying about its dealings in North Korea and supplying surveillance equipment to Iran that was allegedly used to track protesters during anti-government demonstrations in Tehran in 2009.
Huawei has pleaded not guilty to all charges and denied any wrongdoing. A Huawei spokesperson said on Saturday that “The government’s overarching narrative is demonstrably false.”
The case has its origins in reporting by Reuters in 2012 and 2013 concerning Huawei’s relationship with Skycom. Reuters reported that Skycom had offered to sell at least €1.3 million ($1.5 million) worth of embargoed Hewlett-Packard computer equipment to Iran’s largest mobile-phone operator in 2010.
Reuters also reported that Huawei Chief Financial Officer Meng Wanzhou had served on Skycom’s board of directors between February 2008 and April 2009.
The allegations surrounding the two companies became central to the wider US case against Huawei. Prosecutors said Skycom was used to obtain restricted US goods and to move money out of Iran through the international banking system.
According to the US government, one bank, identified by Reuters sources and documents as HSBC, processed more than $100 million worth of US-dollar transactions connected to Skycom. Prosecutors also accused Meng of misrepresenting Huawei’s ownership and control of Skycom during a presentation to an HSBC executive. Meng later acknowledged that the statements were false as part of an agreement with prosecutors under which charges against her were dropped.
The case became a major diplomatic issue in 2018 when Meng was arrested in Vancouver. Her detention triggered a diplomatic crisis involving the United States, China and Canada and placed Huawei at the centre of an increasingly bitter technology confrontation between Beijing and Washington.
A conviction on the Iran-related charges would strengthen Washington’s case for placing Huawei on a US trade blacklist in 2019, a decision based on allegations of criminal conduct that the US government said threatened national security.
The broader dispute has since expanded beyond telecommunications equipment and smartphones into strategically important technologies including artificial intelligence. Huawei is now described as a central component of China’s ambitions in AI chips and has diversified beyond its traditional network equipment and smartphone businesses.
Beijing has repeatedly criticised the prosecution, portraying it as part of a wider US campaign to contain China’s technological rise. Huawei has similarly characterised the criminal case as an effort to undermine its competitiveness and described the trade-secret allegations as a repackaging of commercial disputes that had already been resolved.
The trial, overseen by US District Judge Ann Donnelly, is expected to last approximately three months. It is also expected to overlap with Chinese President Xi Jinping’s September 24 meeting with President Donald Trump in Washington, adding a potentially significant geopolitical backdrop to the proceedings.
Potential jurors have completed 27-page questionnaires, including questions about their views of the Chinese and Iranian governments.
The financial consequences for Huawei could also be substantial if the company is convicted. Prosecutors are expected to seek forfeiture of property or proceeds obtained through illegal activity. If Huawei were found guilty on all counts, legal experts said it could face a significant financial penalty.
“The penalty is going to be determined by the benefit to the company and then multiplied by how serious the wrongdoing is — and that could range from hundreds of millions to billions of dollars,” said Todd Haugh, a professor of business law at Indiana University Kelley School of Business.
If Huawei receives a guilty verdict, Haugh said, “a big fight is going to be proving how much Huawei benefited from their criminal behavior.”
The prosecution was initiated during the first Trump administration, which also moved to restrict Huawei equipment in the United States and urged other countries to exclude the company from their telecommunications networks, citing concerns that China could use its equipment for espionage.
Eight years after the charges were first brought, the trial now places Huawei’s conduct directly before a US jury. Its outcome could carry consequences beyond the courtroom, as Washington and Beijing continue to compete over technology, national security and the future of advanced industries.
