DJI, the world's largest drone manufacturer, sues the U.S. Department of Defense for unfairly accusing it of being a 'Chinese military-affiliated company'
Drone maker DJI has filed a lawsuit against the US Department of Defense, alleging that the organization has unfairly accused it of being a 'Chinese military company' without evidence.
DJI sues the US Department of Defense for labeling it a 'Chinese Military Company' - The Verge
On Friday, October 18, 2024 (local time), DJI, the world's largest drone manufacturer, filed a lawsuit against the U.S. Department of Defense to have the company removed from the 'China Military-related Entity List.' DJI claims that it is not a military company under the Chinese government and that it has suffered unfair damage by being included on the list.
DJI claims that since DJI's name was added to the Department of Defense's list of Chinese military-related entities in 2022, the company has 'lost business deals, been branded by the U.S. government as a national security threat, been barred from contracting with multiple federal agencies, and subjected its employees to frequent and widespread stigmatization and repeated harassment and humiliation in public.'
DJI notified the US Department of Defense of its intention to file a lawsuit in September 2024, but claims that it had not received any explanation from the US Department of Defense as to why it was designated as a 'China Military-related Entity List.' DJI also claims that while the US Department of Defense did provide an explanation for the 'reason for being designated as a China Military-related Entity List,' 'the explanation was full of errors.'
The Verge, a technology media outlet that reported on DJI's lawsuit, has reached out to the Department of Defense for comment, but has not received a response at the time of writing.
DJI maintains that it is not owned or controlled by the Chinese government and that it has 'no involvement whatsoever in the treatment of Uighurs in the Xinjiang Uighur Autonomous Region.' DJI has repeatedly maintained that it simply sells drones that may be used for a variety of purposes, and that independent audits by consulting firms and U.S. government agencies (including the Department of Defense) have found that DJI poses no security threat.
In its complaint, DJI acknowledges that China's state-owned investment funds, the Shanghai Free Trade Zone Equity Fund and the Chengtong Fund, made small investments in the company, but claims that the Shanghai Free Trade Zone Equity Fund only holds 'less than 1% of DJI's shares and less than 0.1% of its voting power,' and that the Chengtong Fund closed its investment in June 2023. DJI also claims that DJI's founders and early employees, Frank Wang, Henry Lu, Swift Xie, and Li Zexian, control 99% of the company and own 87% of the shares.
Regardless of whether they have sufficient evidence to prove DJI’s ties to the Chinese government, several organizations are restricting and scrutinizing their transactions with DJI due to the possibility of ties between the two companies.
The U.S. Army banned its troops from using DJI drones in 2017, and in 2019 the U.S. Department of the Interior banned the use of DJI drones, citing the risk of espionage.
In addition, in 2020, the US Department of the Interior added DJI to its Entity List, banning US companies from exporting technology to DJI, citing the company's ' enabled large-scale human rights violations in China through malicious genetic collection and analysis and high-tech surveillance.'
In 2021, the US Treasury Department added DJI to its list of non-SDN Chinese military-industrial complex companies. The US Treasury Department stated that the reason for adding DJI to the list of non-SDN Chinese military-industrial complex companies was that DJI 'provided drones to the Chinese government to monitor the Uighurs,' suggesting that DJI has contributed to serious human rights violations.
Drone maker 'DJI' and others included in US Treasury Department's 'Chinese military-industrial complex company' blacklist - GIGAZINE
These restrictions have limited US government agencies from purchasing new DJI drones, and DJI claimed that in October 2024, US Customs was blocking the import of DJI drones due to the Uighur Forced Labor Prevention Act.
Congress is currently considering a total ban on the import of new DJI drones and other equipment into the U.S., citing national security risks, but the ban currently remains frozen, and it has been suggested that existing DJI drone owners would be able to keep using them even if Congress were to ban the sale of DJI drones.
If the bill to restrict DJI drones passes the U.S. House of Representatives and the Senate, DJI drones will be hit hard - GIGAZINE
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in Hardware, Posted by logu_ii