Farella Client CNEX Labs Prevails In High-Stakes Trade Secrets Trial Against Huawei

June 26, 2019 Announcement

SAN FRANCISCO, June 26, 2019: Following a three-week trial, a Texas federal jury ruled in favor of Farella Braun + Martel client CNEX Labs, Inc., clearing CNEX of all allegations of trade secret misappropriation, breach of contract, CFAA, and RICO claims made by Chinese smartphone maker behemoth Huawei Technologies. Instead, the jury found in favor of CNEX on its counterclaims for trade secret misappropriation, claims which CNEX uncovered during the discovery phase of the case.

A startup based in San Jose, California, CNEX develops transformative architecture for solid state drive (SSD) controllers. In the lawsuit, Huawei sought at least $85.7 million in damages and rights to CNEX’s memory-control technology, including much of its patent portfolio.

“The jury saw through Huawei’s attempts to use the court system to bully CNEX,” said Farella Partner Jeff Fisher. “It has been an honor to represent the innovative team at CNEX in its fight against Huawei’s baseless claims of trade secret misappropriation. We are thrilled we were able to demonstrate that Huawei was the real thief here.”

The eight-member jury deliberated for less than a day in rejecting all of Huawei’s claims against CNEX.

Farella Partner Eugene Mar added, “We are proud to have defended an innovative startup in CNEX Labs in this bet-the-company case and are deeply appreciative that the jury has put a stop to Huawei’s attempts to bully and intimidate CNEX into turning over its patent portfolio.”

“The company is profoundly grateful to the exceptional team of trial lawyers at Farella Braun + Martel for their dedication to the case and in defending CNEX’s right to innovate,” said Matthew Gloss, CNEX’s general counsel.

In addition to Fisher and Mar, the trial team included Farella’s Daniel Callaway, Stephanie Skaff, Jeffrey Lau, and Nadia Arid, and Deron Dacus of the Dacus Law Firm, and Bryan Kohm and Shannon Turner of Fenwick & West.

CNEX press release

The case is Huawei Technologies Co. Ltd. v. CNEX Labs, Inc. et al., 4:17-cv-00893, U.S. District Court, E.D. Texas.

Farella Braun + Martel is a leading Northern California law firm representing corporate and private clients in sophisticated business transactions and complex commercial, civil and criminal litigation. Clients seek our imaginative legal solutions and the dynamism and intellectual creativity of our lawyers. We are headquartered in San Francisco and maintain offices in the Napa Valley that are focused on the wine industry.

Cheryl Loof
(415) 954-4433 / [email protected]