13 April 2011 Last updated at 22:55 ET

Huawei settles Motorola Solutions trade secrets dispute

Technology companies like Motorola are keen to protect their innovations

Huawei, a Chinese telecom equipment maker, and Motorola have settled their dispute over trade secrets.

Huawei had objected to the sale of one of Motorola's business units, Motorola Solutions, to Nokia, saying the deal may see some of its trade secrets ending up with its competitor.

Motorola said it had agreed to pay an unspecified transfer fee to Huawei as a part of the settlement.

The deal clears the way for Motorola to complete the sale.

Motorola also said it had reduced the sales price of the unit from $1.2bn (£737m) to $975m in a bid to push it through.

However, Motorola Solutions' spokesman Nick Sweers said that the deal still needed to be approved by the Chinese antitrust authorities.

Improving relations

Huawei has been looking to improve its relations with the US authorities after its business deals were put under scrutiny.

The company was founded by Chinese former army officer Ren Zhengfei, and there have been concerns that it still has military links.

In February, Huawei's attempt to buy American company 3Leaf systems was rejected by the US security panel.

It had called on the US authorities to carry out a thorough investigation into its ownership and business.

The company's spokesman, Bill Plummer, said that the current settlement was a strong indication of best practises followed at the company.

Huawei's lawyers said they hoped the settlement with Motorola will allay fears about the company's connections.

"Huawei hopes the recognition of the value of its intellectual property and withdrawal of claims about it would help put behind [it] rumours of association with the Chinese government," said Robert Haslam of Covington & Burling.