A federal judge has blocked enforcement of the U.S. investment ban on Xiaomi Corp., calling the decision to blacklist the Chinese technology giant “deeply flawed.”
Ordering a temporary halt to the ban in a decision late Friday, Judge Rudolph Contreras cast doubt on the Pentagon’s decision in January to designate Xiaomi XIACY HK:1810 as a company with links to the Chinese military. Judge Contreras said the U.S. failed to convincingly show such links in prior filings with the court.
The Chinese company is definitely pushing for a court ruling that will declare its addition to the investment blacklist as a “Communist Chinese military company” unlawful. Xiaomi was set to lose out on crucial US investment with it potentially being delisted from US exchanges by 2021, if they were still a part of the ban.
It is probably going to go well for Xiaomi, given how the US Department of Defense’s main justification for the ban was mainly because Xiaomi’s founder, Lei Jun, received an award from the Ministry of Industry and Information Technology (MIIT), and subsequently concluded that Xiaomi was a military-linked company.