DJI loses lawsuit over classification as Chinese military company

In a significant ruling, a federal court has upheld the Department of Defense's classification of drone manufacturer DJI as a contributor to China’s military capabilities. U.S. District Judge Paul Friedman dismissed DJI's request to be removed from the controversial list, citing substantial evidence linking the company to the Chinese defense sector. The judge highlighted the use of DJI drones in the ongoing conflict between Russia and Ukraine, emphasizing that the company’s policies against military use do not negate the military applications of its technology. Judge Friedman noted, "Whether or not DJI’s policies prohibit military use is irrelevant. That does not change the fact that DJI’s technology has both substantial theoretical and actual military application." While the court supported the DoD's decision, it also rejected some of the agency's other arguments for placing DJI on the list. Additional government bodies, including the Department of Commerce and the Treasury Department, had previously included DJI in similar classifications before its 2022 addition to the DoD list. DJI initiated the lawsuit last year, asserting that it is not under the control of the Chinese military and that its primary focus is on consumer and commercial drones. The company claimed that the military designation has led to severe financial and reputational damage, including lost business opportunities. In response to the ruling, DJI expressed disappointment, indicating that it is exploring further legal avenues. The company criticized the judgment, stating it was based on a rationale that could apply to many other businesses that have not faced similar listings. Additionally, DJI is facing potential challenges in the U.S., including a looming sales ban set to take effect in December unless its drones are deemed safe for national security.