Judge Blocks DoD Military Designation of WuXi AppTec

U.S. District Chief Judge James Boasberg granted a preliminary injunction to WuXi AppTec, blocking the United States Department of Defense from enforcing a designation that labeled the pharmaceutical research and manufacturing services provider as a Chinese military entity.

The court determined that defense officials misread evidence regarding a People's Liberation Army hospital, Chinese universities, and a state-linked fund. Judge Boasberg stated that the designation functioned as a "scarlet letter," which led customers and suppliers to cancel contracts and shift their business to competitors.

The ruling represents an early legal victory for WuXi AppTec and a setback for the U.S. government's application of national-security restrictions against Chinese commercial firms. The Department of Defense has declined to comment on whether it intends to appeal the decision.