US mobile phone maker Motorola Inc has filed a lawsuit against Chinese telecom equipment giant Huawei Technologies Co of conspiring with its former employees to steal intellectual property over a number of years.

The Chinese networking gear maker, which is under the scanner of the Indian security agencies, had also been sued in 2003 by networking giant Cisco Systems for stealing its router code, which forced Huawei to remove its routers from the market.

The Motorola suit suggests that Huawei was running a complex espionage plot involving five former Motorola employees, four of whom held Chinese citizenship and another who held dual, US and Chinese citizenship.

The five were under the direct charge of Shenzhen-based Huawei's founder and CEO, Ren Zhengfei, a former People's Liberation Army officer, who is reported to have close links to Chinese intelligence agencies.

Schaumburg, Illinois-based Motorola had originally filed a suit in 2008 against Lemko, which was set up in 2004 by one of Motorola's ex employee Shaowei Pan, who become its chief technology officer, of stealing trade secrets of the company.

Motorola added Huawei's name in its July 2010 addendum to the suit, claiming that Lemko, also based in Schaumburg was established under the directions of Huawei on the garb of an equipment vendor to Huawei but with the sole purpose of facilitating Motorola's Chinese employees to pass on the company's intellectual property to Lemko, which in turn, passed on to Huawei.

Huawei's name was added after Motorola found numerous emails of Motorola product specification documents marked 'Motorola Confidential Proprietary' sent to Ren Zhengfei and JinLong Hou, Huawei's vice president of wireless communications.

"Defendant Shaowei Pan was a trusted senior engineer and director of architecture working full time at Motorola on the development of new products and new technologies for Motorola…However, as set forth below, defendant Shaowei Pan and the others were clandestinely engaged in new product development for Huawei," according to the amended complaint filed by Motorola on 16 July.

Shaowei Pan is accused of  transmitting proprietary and confidential Motorola specifications for the Motorola SC300 base station transceiver, a component used for internet protocol soft switching technology for cellular systems to Ren Zhengfei and Jin Long Hou.

"Attached please find those document about SC300 (CDMA 2000 1X) specification you asked," Pan wrote in his email sent to Hou. Motorola said that Hou acknowledged receiving the email.

Lter, Huawei and Lemko started marketing the equipment based on Motorola's stolen technology.

Motorola said in its complaint that before a judge ordered him to hand over the data to US authorities, Shaowei Pan tried to remove all contents from his home computers using file-destruction software, but Motorola said that it was able to recover some evidence from his computers that revealed the elaborate operation run by Huawei.

Motorola claims that prior to Huawei setting up the elaborate plan, Shaowei Pan had held a meeting with Ren Zhengfei in Beijing in February-March 2003, where an agreement for the transfer of Motorola proprietary information was hatched.

Hanjuan Jin, who joined Motorola in 1998 as a software engineer, also worked secretly for Lemko since 2004 and was able to access the company's internal computers and steal confidential information and pass them on to Lemko.

She was caught in 2007 with a one-way flight ticket from Chicago to Beijing by US Customs officials just as she was about to board the flight. Her baggage contained $30,000 in cash and more than 1,000 paper and electronic propriety documents related to Motorola's communication network technology.

Another former employee of Motorola was caught buying Motorola mobile handsets in large quantity, for which he sent unlock codes and dump files to Lemko to enable it undertake reverse engineering and bring out a similar product in the market, a Chinese speciality.

Huawei said a statement this week in that its relationship with Lemko was only based on a reseller agreement and has no other relationship with the company just like the agreement it has with Motorola to resell Huawei's wireless equipment.

"Based on our review of the complaint so far, the complaint is groundless and utterly without merit and Huawei has great respect for the rights of intellectual property holders," it said in its statement.

Although Motorola has presented strong evidence in the court, it will find it difficult to bring Huawei to book in the US just as Cisco found and was compelled to settle out of court, say analysts.

At the most, the ex Motorola and Lemko employees could be charged.

If Motorola follows the case to its logical conclusion and takes the help of the US lawmakers, Huawei could be banned from doing business in the US, say analysts.

The related theft of its communication network technology is still relevant to Motorola although it sold its telecommunications network equipment business this week to Nokia Siemens for $1.2 billion (See: Nokia Siemens snaps up Motorola's gear business for $1.2 billion) as Motorola has still retained the iDEN business, substantially all the patents related to its wireless network infrastructure business and other selected assets.