Ducks, rabbits, and the case of Meng Wanzhou

The U.S. government and Huawei executive Meng Wanzhou are reportedly negotiating a deal that would permit her to leave Canada and return to China. What mix of law and politics is shaping those negotiations? And what are the implications for the incoming Biden administration?

Legal scholar Martti Koskenniemi has emphasized that, just as the classic optical illusion can be viewed as a duck or a rabbit, international events simultaneously carry legal and political significance. Reports that the U.S. government has been negotiating resolution of criminal charges with Huawei executive Meng Wanzhou raise a duck/rabbit conundrum. What mix of law and politics is shaping those negotiations? And what are the implications for the incoming Biden administration?

A duck/rabbit blurring has been present since the United States announced charges against Meng and Huawei nearly two years ago. On the law side, charges against Meng—who is contesting extradition in the Canadian courts—are largely based on allegations of fraud, a staple of federal prosecutions. Yet the case against Meng was never your standard fraud case in part because it wades into U.S.-Iran relations: several counts involve Huawei’s alleged business dealings with Iran in contravention of the International Emergency Economic Powers Act.

Politics were also on display when, just prior to the February 2020 announcement of a superseding indictment, Attorney General Barr warned as follows:

Within the next five years, 5G global territory and application dominance will be determined. The question is whether, within this window, the United States and our allies can mount sufficient competition to Huawei to retain and capture enough market share to sustain the kind of long-term and robust competitive position necessary to avoid surrendering dominance to the Chinese.

As for the PRC, Meng’s December 1, 2018, detention was followed days later by the detention of Canadians Michael Kovrig and Michael Spavor. I recall sucking in air upon hearing the news while on a trip to Beijing. This was no coincidence, with Prime Minister Trudeau later publicly commenting that the PRC “made a direct link” between the Canadians’ detention and Meng’s arrest. Two years into their arbitrary detentions, despite the PRC government’s statements that it has “consistently handled the two cases in accordance with Chinese laws” it is irrefutable that politics, not law, will decide their fates.

Today, the U.S. Department of Justice (DOJ) is reportedly negotiating with Meng to resolve the charges via a deferred prosecution agreement that would require some level of admission of wrongdoing by Meng in exchange for the United States dropping the extradition request. To be sure, criminal cases in the United States are resolved through negotiated agreements all the time. There are not, however, usually so many layers to the negotiations. Given the vast prosecutorial discretion, how much of an admission would DOJ require? And how much is Meng willing to give? It would be shocking indeed if she became a cooperating witness against Huawei. So what can she admit to without providing ammunition for DOJ’s case? And what personal considerations are in play, including her own career, her father’s (Huawei founder Ren Zhengfei) legacy, and her children’s future? And what conversations are occurring between Canadian and American officials in parallel to the negotiations with Meng?

It is unclear too whether an agreement would even trigger release of the detained Canadians. Any “deal” would at best be a tacit understanding and, even then, the PRC government’s repeated assurance of the strength and severity of the allegations would likely mean a conviction for something and some sort of criminal punishment, even if truncated. Meng’s legal case is but one facet of what has grown into a much larger political imbroglio.

As I write, we await President-elect Biden’s pick for Attorney General. I cannot help but think whoever is selected would breathe a sigh of relief if the Trump administration reaches a deal with Meng: not because that person would necessarily know the evidentiary strength of the case or other legal insights that might lean away from proceeding to trial, but rather because it would remove a major political headache from both U.S.-PRC and U.S.-Canada relations. Extradition cases are not “you break it, you own it” whereby the administration that starts the case must resolve it before departure. Yet if the Trump administration does resolve the case, the Biden administration has a hope of largely passing off the whole chapter as just another aberration of the hyper-politicized Trump DOJ.

If the Meng case lands in the Biden administration’s lap, then the new Attorney General will need to emphasize the law part of the equation or risk looking like politics are again holding sway within DOJ. Moreover, ducks would likely not be the birds on people’s minds: instead, any indication that the Biden administration was acquiescing to PRC demands would look like a dovish “reset” when the incoming administration is under pressure to build some hawkish street cred.