Hesai Says New Designation as Chinese Military Company Equally as 'Baseless'
Chinese lidar company Hesai Technology filed an amended complaint in its suit against its designation as a Chinese military company after the Pentagon relisted the company (see 2410230018), arguing that the decision is "just as unsubstantiated and weak as the original one that they recently refused to defend" (Hesai Technology Co. v. Department of Defense, D.D.C. # 24-01381).
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Hesai claimed that DOD violated the Administrative Procedure Act for exceeding its statutory authority, making an arbitrary and capricious decision, unreasonably delaying its decision and depriving Hesai's due process rights.
Hesai was designated as a Chinese military company in January 2024 under the Pentagon's 1260H List. The company said the move was made without warning or explanation, adding that government lawyers had reportedly expressed concerns about whether the listing would hold up in court (see 2408130022).
The Pentagon removed the firm from the 1260H List but immediately relisted it in October based on new information (see 2410240037). This new designation is "equally baseless and unlawful," Hesai's amended complaint said. The company claimed that relisting "is most notable for what it lacks: any accusation whatsoever that Hesai is owned or controlled by the Chinese military; sells products to the Chinese military; or otherwise directly supports the Chinese military (or any other military) in any way."
Hesai said it's not "owned or controlled" by the Chinese military, adding that its designation as a Chinese military company has caused "serious reputational injury, a significant drop in stock price, and lost business opportunities."