Chinese telecoms equipment company Huawei plans to announce a lawsuit against the United States government on Thursday on grounds related to a defence bill, a source with knowledge of the matter told Reuters.
Huawei is preparing to announce that it is suing the U.S. government in a court in Texas by challenging an addition to the U.S. National Defense Authorization Act (NDAA) signed last year, according to the source.
The new NDAA act, which Beijing had condemned as targeting China, controlled U.S. government contracts with Chinese companies including Huawei and strengthened the role of the panel that reviews foreign investment proposals.
The New York Times first reported Huawei's planned legal move on Monday, citing two people familiar with the matter.
Huawei declined to comment. It had invited Reuters and other international media to a press conference at its Shenzhen headquarters in China on Thursday.
Such a move would be the latest in a series of responses from the Chinese company as Washington tries to persuade allies to ban Huawei from business alleging espionage risks. Huawei has repeatedly denied the claims.
On Sunday, lawyers for Huawei's Chief Financial Officer Meng Wanzhou sued the Canadian government, its border agency and federal police, alleging their client was detained, searched and interrogated for three hours in violation of her constitutional rights.
That comes after Canada on Friday approved a hearing on a U.S. extradition request for Meng on charges related to breaking Iran sanctions.
The New York Times cited a source as saying Huawei's suit is likely to argue that the NDAA provision is a "bill of attainder," or a legislative act that singles out a person or group for punishment without trial, according to the newspaper report.
Canada arrested Meng in Vancouver on Dec. 1 at the request of the United States, which has brought sweeping charges against her and Huawei that portray the company as a threat to U.S. national security. The case has strained Canada's relations with China.
(Reporting by Sijia Jiang in HONG KONG and Rishika Chatterjee in Bengaluru; Editing by Shounak Dasgupta/Keith Weir)
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