Xiaomi Corp. sued the U.S. Defense and Treasury departments, challenging a blacklisting that blocks American investors from buying the Chinese smartphone giant’s securities.
The lawsuit came after the Defense Department determined earlier this month that China’s biggest smartphone maker was affiliated with the People’s Liberation Army. Beijing-based Xiaomi called the blacklisting “unconstitutional” and seeks a court ruling to reverse the designation, which was made in the waning days of the Trump administration.
“Xiaomi faces imminent, severe, and irreparable harm if the Designation remains in place and the restrictions take effect,” the company said in the filing in the U.S. district court of Columbia. The lawsuit also named Defense Secretary Lloyd Austin and Treasury Secretary Janet Yellen as defendants.
Under former President Donald Trump, the U.S. had targeted scores of Chinese tech companies citing national security. Huawei Technologies Co., one of the biggest rivals to Xiaomi in smartphone market, was cut off from its key suppliers as a result of a series of restrictions imposed by the former administration. Chinese chipmaking giant Semiconductor Manufacturing International Corp., Shenzhen-based drone maker SZ DJI Technology Co. are also among the companies that have been blacklisted.