Washington, DC., United States of America – March 12, 2021 – U.S. Court rules in favor of Xiaomi against restrictions. A Judge in Washington mandated the Defense Department from restricting U.S. investment in the Chinese smartphone manufacturer Xiaomi Corporation.
Currently, Xiaomi is the third-largest smartphone manufacturer in the market today. It is behind U.S. trillion-dollar company, Apple.
To recall, in the final days of the Trump administration, the Defense Department placed Xiaomi on a list of companies with alleged links to the Chinese military. This action triggers financial restrictions that were scheduled to go into effect this incoming week.
It was on Friday, a judge named Judge Rudolph Contreras put an end to the ban. He sides with Xiaomi in a lawsuit that argued that the move was “arbitrary and capricious” and deprived the company of its due process rights. In my opinion, this has something to do with the trade war going on between China and U.S.
According to the opinion of Judge Contreras, Xiaomi was likely to win based on litigation and issued an initial injunction. The company faced financial distress when the ban was announced. This action gives investors a second thought as to how they will decide for their stocks moving forward.
After the decision was made, Xiaomi is now requesting to the court to have the labeling as unlawful. This label includes Xiaomi as being connected to the Chinese Military, which is very alarming to users if someone is trying to spy on them.
Judge Contreras also wrote, “The court is somewhat skeptical that weighty national security interests are actually implicated here,” in his legal opinion.
The case is Xiaomi v. Defense Department, 21-cv-280, U.S. District Court, District of Columbia (Washington).