Huawei has denied being involved in a plan by former Motorola staff to steal confidential information and use it to set up their own company in competition with Motorola. Last week, a modified lawsuit by Motorola alleged that former employee Shaowei Pan secretly reported to Ren Zhengfei, Huawei's founder and chairman, while he was working at the US company. Motorola claims that the defendants were developing a microcell base station, and later passed technical details over to Huawei

"The complaint is groundless and utterly without merit. Huawei has no relationship with Lemoko, other than a reseller agreement," a spokesman of Huawei was quoted by the official news agency, China Daily as saying."Huawei will vigorously defend itself against baseless allegations," it added.

"Moreover, as an active and significant player in global standards-setting bodies, Huawei has great respect for the right of intellectual property holders, and will with equal vigor protect its own hard-earned intellectual property rights," the company said.

One commentator even suggested that the lawsuit is just a tactic to deter US networks from switching from Motorola following the recent sale of its infrastructure business to Nokia Siemens Networks.

"I think Motorola's plan to file a lawsuit is a marketing tactic," said Wang Yuquan, senior consultant with research firm Frost & Sullivan China. "In fact, it is the right time for Huawei to expand in the US as the NSN acquisition will impact many Motorola customers.