Beijing-based Xiaomi Corporation sued the U.S. Defense and Treasury departments. The corporation challenged a blacklisting that will block American investors from buying the Chinese smartphone giant’s securities.
The lawsuit came after the Defense Department determined Xiaomi was affiliated with the People’s Liberation Army which the department found out earlier this month.
The company called the blacklisting “unconstitutional” and further sought court ruling in order to reverse the designation, which was made under Trump’s administration.
In the U.S. district court of Columbia, the company said in it’s filing “Xiaomi faces imminent, severe, and irreparable harm if the Designation remains in place and the restrictions take effect,”. Further, the lawsuit also named Defense Secretary Lloyd Austin and Treasury Secretary Janet Yellen as defendants.
Former U.S. President Donald Trump had targeted several Chinese tech companies in the name of national security. Huawei Technologies Co was one of the companies which were cut off from its key suppliers as a result of a series of restrictions imposed by the former administration.
Among other Chinese operations was Semiconductor Manufacturing International Corp., Shenzhen-based drone maker SZ DJI Technology Co.
Top American institutional investors in Xiaomi were BlackRock Inc., the Vanguard Group Inc. and State Street Corp that would be forced to divest holdings in the company by November, according to the filing. U.S. chipmaker Qualcomm Inc. was also one of the earliest investors in Xiaomi, which was co-founded by billionaire Lei Jun a decade ago.
