DJI, the world's largest drone maker, has won an interim step in a lawsuit against the US Defense Department. The US Court of Appeals for the District of Columbia Circuit ordered a lower court to reconsider whether DJI should remain on the Defense Department's list of Chinese military companies, compiled under Section 1260H.
The appeals court's view
The appeals court found that the lower court had erred by relying solely on unclassified evidence to conclude that DJI contributed to China's defense industrial base. On that basis, it asked for the finding to be reconsidered. For DJI, it is a partial victory, but at least it puts the earlier conclusion back under review.
DJI's position
DJI has consistently denied any links to the military. The company has said that its placement on the list cost it business opportunities, stigmatized it as a national security threat, and prevented US federal agencies from doing business with it, with real effects on its operations.
A wider backdrop
The case also reflects a larger trend. In recent years, US efforts to designate well-known Chinese civilian technology firms as having military ties have faced growing legal scrutiny. How to draw the line between civilian and military use, and what evidence is enough to make such a designation, have become focal points of dispute.
For DJI, the reconsideration is only a procedural step, and the final outcome remains uncertain. Whatever the result, the case offers a concrete window onto the friction between China and the US over technology and trade.
