Chinese drone manufacturer DJI has filed a lawsuit against the United States (U.S.) Department of Defense (DOD), challenging its designation as a “Chinese military company.” The lawsuit, filed on Friday in the Washington, D.C., District Court, asserts that the designation is inaccurate and has caused significant financial and reputational harm to DJI. The company claims that it is not owned or controlled by the Chinese military and primarily sells consumer and commercial drones, rather than military-grade equipment.
DJI, represented by the law firm Paul Weiss, names Defense Secretary Lloyd Austin and Deputy Defense Secretary Laura Taylor-Kale as co-defendants. The company contends that after attempting to engage with the DOD for over 16 months without receiving a clear rationale for the designation, it had no choice but to seek legal recourse. DJI’s lawsuit argues that the DOD’s decision was based on “stale facts” and “attenuated connections,” which the company believes are insufficient to classify it as a military-linked entity. It also highlights that DJI’s CEO Frank Wang and three early investors hold the majority of voting rights and shares, distancing the company from Chinese military control.
The designation stems from the DOD’s 2022 listing of DJI as a “Military Company Operating in the United States,” which followed a broader U.S. government crackdown on Chinese companies. In 2020, DJI was placed on the Department of Commerce’s Entity List, restricting U.S. companies from selling to it, and in 2021, the Treasury Department added the company to its investment blocklist. These actions were linked to allegations that DJI was involved in the surveillance of Uyghur Muslims in China’s Xinjiang region, accusations the company has denied.
DJI’s lawsuit also comes amid a growing congressional effort to ban its drones from U.S. airspace, with the House Select Committee on China recently urging further investigation into DJI’s potential efforts to bypass trade restrictions through front companies.
While DJI seeks to overturn the military designation, critics argue that the lawsuit is part of a broader strategy by Chinese firms to challenge U.S. legal frameworks and regulations. Craig Singleton, a senior fellow at the Foundation for Defense of Democracies, described the lawsuit as a “dead-end” for DJI. The DOD has yet to comment on the lawsuit.
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