U.S. Accuses Huawei Defense Lawyer of Conflict of Interest

(Bloomberg) -- U.S. prosecutors in a high-profile case against Huawei Technologies Co. are seeking to disqualify the company’s lead lawyer, saying he has a conflict of interest stemming from his former role as second-in-command at the Justice Department.

James M. Cole should be excluded from the Chinese smart-phone maker’s defense team because he had access to classified investigations that appear to be connected to Huawei during his four-year tenure under then-Attorney General Eric Holder, prosecutors said in a heavily-redacted memo filed Friday. He has refused to recuse himself from the case despite having an "obvious conflict of interest" that would give him an unfair advantage, according to the filing in federal court in Brooklyn, New York.

Cole is defending Huawei and a U.S. affiliate against charges that they defrauded at least four banks by concealing business dealings in Iran in violation of U.S. sanctions. Meng Wanzhou, Huawei’s chief financial officer, who is also charged in the case, remains free on bail in Vancouver while she fights extradition to the U.S.

Cole, as a partner at Sidley Austin LLP, has been representing Huawei since at least April 2017, when the U.S. served subpoenas upon the company during its investigation, according to prosecutors. He met with Brooklyn prosecutors in October 2018 to discuss the Huawei probe and met them again in January, after Wanzhou was arrested by Canadian authorities at the behest of the U.S.

“Cole’s work on these related matters creates the real risk that he will breach his duty of confidentiality to the DOJ by relying on information he obtained while representing the department in the course of his representation of the defendants," according to filing by the the U.S.

The attorney stood by his decision not to recuse himself in a March 6 letter to prosecutors. "We have carefully considered the material you showed us and were unable to determine that I need to be disqualified," he wrote, according to prosecutors.

Kellie Mullins, a spokeswoman for Sidley Austin, didn’t have an immediate comment.

©2019 Bloomberg L.P.