Cisco extends IP fight with Huawei

Ben Klayman

CHICAGO: Cisco Systems Inc., the world's largest maker of equipment that directs Internet traffic, has extended the suspension of its copyright lawsuit against Huawei Technologies Co. Ltd., according to court documents.

Cisco, based in San Jose, California, in a March 31 request signed by its attorneys and those of Huawei, asked the U.S. District Court in Marshall, Texas, to suspend the lawsuit another six months. Judge T. John Ward granted the request the next day.

"The parties now request an additional stay to complete the review process that is currently underway," Cisco and Huawei said in the court documents.

Cisco sued privately-held Huawei in January 2003, accusing China's largest maker of telecommunications gear with copying its intellectual property, documents and other material, and infringing on several patents.

Most of Huawei's sales come from the telecoms sector and the company wants to boost corporate business, where Cisco reigns. It has formed a joint venture with Cisco rival 3Com Corp. to serve those customers.

Cisco's lawsuit had been suspended since Oct. 23, 2003, after Huawei agreed to stop selling disputed products and submit any modified gear to an independent expert for review.

Cisco and Huawei said last week that they have agreed to a schedule for review of Huawei products that may not be completed until July 2004, according to court documents.

Cisco officials declined further comment, but previously said they expected the agreement reached with Huawei to lead to the resolution of the lawsuit. Huawei could not be reached for immediate comment.

Last October, Huawei agreed to stop selling disputed routers and switches and to modify its products, including changing user manuals and parts of Huawei's source code.

Source code, the underlying blueprint of computer software, determines how programs work. A router connects computer networks for transmitting of data and information, while a switch directs network traffic.

Although Huawei and other low-cost rivals do not pose a serious threat to Cisco now, analysts ultimately expect them to squeeze Cisco's core business of switches and routers, which account for 75 percent of its sales and profits.

3Com, which formed its joint venture with Huawei last November, intervened in the lawsuit last summer.

Cisco shares last traded up 14 cents, or 0.57 percent, at $24.57 in early afternoon trading Monday on Nasdaq.

© Reuters