Chinese telecom equipment maker Huawei Technologies won the first round of a legal battle against Motorola this week.
An Illinois federal district court granted the Chinese manufacturer a temporary restraining order that prevents Motorola Solutions from disclosing confidential information about Huawei's technology to Nokia Siemens Networks, which has announced plans to buy Motorola's wireless networks business.
Motorola announced in July 2010 that it plans to sell its entire wireless infrastructure business to Nokia Siemens in a deal that is worth about $1.2 billion.
Huawei announced Monday that it is suing Motorola in U.S. District Court in Illinois.
In the temporary restraining order, U.S. District Judge Sharon Johnson Coleman barred Motorola from transferring any sensitive information from Huawei to Nokia Siemens. She said she issued the temporary restraining order since the companies are already in arbitration. But she did not grant Huawei's request that it get five days notice before the deal closes. Instead, she said Motorola and Nokia Siemens should alert the court and Huawei 24 hours in advance of the deal closing.
Motorola has been reselling Huawei radio access gear for GSM and UMTS wireless networks since 2000. As part of this relationship, Motorola employees have been trained to sell and troubleshoot Huawei's wireless products. Nokia Siemens also makes and sells GSM and UMTS gear that competes directly with Huawei's equipment.
Huawei argues in its complaint that the transfer of Motorola's UMTS and GSM equipment assets to Nokia Siemens would cause "the massive disclosure of Huawei's confidential information to NSN, with irreparable harm to Huawei." Specifically, the company argues that a large number of Motorola employees, who will be transferred as part of the deal to Nokia Siemens, have direct knowledge of Huawei's confidential information.
A Motorola spokeswoman said the company believes the lawsuit is without merit. She also reiterated that the company still expects to complete the sale of the Motorola Networks business to Nokia Siemens Networks in early 2011 following receipt of approval from China's antitrust authorities.
Updated 12:39 p.m. PT:This story has been updated with comments from Motorola.