Chinese gear-maker retreats after Cisco challenge

China's biggest telephone equipment maker has said it is no longer shipping US customers the routers and switches that Cisco Systems alleges violate its patents and copyrights.

Huawei Technologies representative Wendy Wu said on Friday the equipment maker began scaling down shipments after Cisco raised its concerns informally and before Cisco filed its lawsuit in the US District Court for the Eastern District of Texas.

"Prior to the filing of the lawsuit, we had already taken steps to address these claims, including pulling the product from US customers," Wu said. "Cisco has shown that it's not interested in having a constructive dialogue. Instead it's deciding to use litigation to enhance its market position."

Huawei Technologies said the shipments represented just a small fraction of its US activities. Wu did not say what companies were supposed to receive the goods or if Huawei continues to ship the same equipment to companies in other nations.

"We are developing and releasing new products that won't be subject to Cisco's litigation," Wu said.

A Cisco representative had no comment Friday. Cisco CEO John Chambers recently said Huawei's product undercut Cisco prices and therefore posed a possible threat to Cisco's dominance in the router and switch market.

Cisco is asking the court for preliminary and permanent injunctions to prohibit Huawei from using or selling the products in question. Cisco is seeking damages as well. The company said it also served a cease-and-desist letter to Spot Distribution in the UK. Spot is distributing Huawei products that Cisco claims copy its intellectual property.

Cisco's lawsuit claims Huawei violated at least five Cisco patents and copied Cisco's Internetwork Operating System (IOS) source code, using it in the operating system for its Quidway routers and switches. Huawei's system contains text strings, file names and bugs identical to those found in Cisco's copyright-protected source code, the company alleges in its suit.

This is the first time Cisco has used litigation to protect its patents and the copyright it has on software.