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China-U.S. trade war heats up as Huawei pushes court case, Beijing levels rare earths threat

Huawei steps up U.S. legal battle

Shenzhen, China -- The heat in the U.S.-China trade war keeps getting turned up, with a Chinese tech giant escalating its legal battle in a U.S. court and the communist nation's media conveying a new threat to deprive America's tech manufacturers of vital components.

In the latest tit-for-tat between Huawei and the White House, the Chinese technology firm sought to hasten a decision from a U.S. district court in Texas, where the company is arguing the Trump administration's ban on its products is unconstitutional.

Washington has alleged Huawei's products may have technological backdoors that could facilitate Chinese espionage, prompting President Trump's executive order in mid-May banning Huawei equipment in the United States on national security grounds.

Days later, the Commerce Department placed Huawei on a blacklist, known as the "Entity List," cutting the company off completely from American-made components vital to its own products, including its 5G wireless technology and mobile phones. That ban is under a grace period -- so not technically implemented -- until August 19, when it will take effect unless there is some resolution to the dispute or the U.S. government extends the grace.

U.S. loosens restrictions on Huawei products temporarily

In a press conference at Huawei's global headquarters in Shenzhen, chief legal officer Song Liuping said Wednesday that the U.S. ban on Huawei products violates the company's right to due process by presuming guilt before innocence, leaving Huawei no reasonable chance to defend itself in court.

He said Huawei would file for a summary judgment in the case, filed in March. The filing is a legal maneuver aimed at avoiding a full-blown trial by having the court issue a quick decision. Huawei filed the initial lawsuit in March in the Eastern District of Texas, challenging the ban's constitutionality.

"The U.S has provided no evidence, no gun, only speculation," Song said on Wednesday, adding that blocking Huawei from the U.S. "will do nothing to make networks more secure. They provide a false sense of security, and distract attention from the real challenges we face."

CHINA-US-TELECOMMUNICATION-ESPIONAGE-COURT-HUAWEI
Song Liuping (L), chief legal officer of Chinese tech giant Huawei, and Vincent Pang (R), Head of Corporate Communications of Chinese tech giant Huawei, attend a press conference at the Huawei facilities in Shenzhen, Guangdong province, May 29, 2019. Getty

Song accused U.S. officials of "using the strength of an entire nation to come after a private company… This is not normal. Almost never seen in history."

Huawei has been caught up in the expanding U.S.-China trade war.

President Trump suggested last week that any bilateral deal could include a better outcome for Huawei, something the company's CEO Ren Zhengfei dismissed as "a big joke" in an interview with Bloomberg Television, noting the U.S. never bought Huawei products from China.

China's rare earth trump card?

China's state media said Wednesday that the ongoing dispute could threaten U.S. access to rare earth elements.

"Rare earths" as they're commonly known, are crucial to the manufacture of everything from smartphones to electric cars and televisions, and even some military hardware.

Rare Earth Elements

China produces more than 95 percent of the world's supply of rare earths, and the United States relies on Beijing for upwards of 80 percent of its imports.

"While meeting domestic demands is a priority, China is willing to try its best to satisfy global demand for rare earths as long as they are used for legitimate purposes," said a commentary published Wednesday by the state-run Xinhua news agency. "However, if anyone wants to use imported rare earths against China, the Chinese people will not agree."

Last week, Chinese president Xi Jinping's visit to the country's biggest rare earths producer -- which was broadcast on national television -- was widely interpreted as a threat to the U.S.

Xi said the metals were "not only an important strategic resource, but also a non-renewable resource," according to Xinhua.

President Trump is scheduled to meet Xi in Japan during the G-20 summit in June.

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