"The court is somewhat skeptical that serious national security interests are actually involved."
A federal judge in Washington has banned the Department of Defense from restricting U.S. investments in Chinese smartphone maker Xiaomi. That's why American investors retained the right to buy Xiaomi securities.
In the final days of Donaln Trump's administration, the Department of Defense listed Xiaomi on a list of companies allegedly linked to the Chinese military, leading to financial restrictions that were to come into effect later. But on Friday, US District Judge Rudolph Contreras backed Xiaomi, which said the move was "headstrong and capricious" and stripped the company of its due process rights.
Contreras said Xiaomi will likely win the case in the end and issued an initial injunction to prevent "irreparable harm" from being inflicted on the company. Xiaomi has said that it plans to continue to demand that the court declare illegal the company's fictitious relationship with the Chinese military.
In November, former President Donald Trump signed a decree banning American investment in Chinese firms owned or controlled by the military in an attempt to pressure Beijing. The US has also imposed bans on popular Chinese apps like WeChat and TikTok, citing threats to national security.
US District Judge Rudolph Contreras commented: "The court is somewhat skeptical that serious national security interests are actually involved."