DJI, the world's largest drone manufacturer, has reportedly filed a lawsuit against the U.S. Department of Defense, challenging its designation as a "Chinese military company." The Pentagon added DJI to its list of entities with alleged ties to China’s military in 2023, which bars American investors from trading shares in companies on the list.
DJI argues that this classification is unjustified and harms its reputation, as it insists it operates independently and has no military affiliations. The lawsuit seeks to remove DJI from the list and counter potential negative consequences for its business. The company’s portfolio of products, which includes drones, camera systems, and other accessories, is widely used around the globe for commercial and recreational purposes.
The Pentagon’s decision to place DJI on its Chinese military list seems to be a larger effort to reduce reliance on Chinese technology in sensitive areas and protect national security. DJI, however, contests that it has no direct involvement with China's military. The company also claims that the designation has caused substantial harm to its business by limiting its access to U.S. investment and markets, as well as damaging its reputation internationally.
This isn’t the first time DJI has faced scrutiny from U.S. authorities. The company has been on the U.S. Department of Commerce’s Entity List since 2020. Earlier this year the United States House of Representatives passed the "Countering CCP Drones Act" as a part of the United States' 2025 National Defense Authorization Act (FY25 NDAA). While that meant a ban on the future sale of DJI drones in the United States, the U.S. Senate Armed Services Committee's version of the 2025 National Defense Authorization Act (NDAA), released in July, did not include the Countering CCP Drones Act.
In its lawsuit, DJI contends that the Pentagon's decision was made without proper evidence and that its inclusion on the Chinese military list is based on speculative or erroneous conclusions. The company maintains that it operates independently and focuses solely on commercial drone technology, with no direct connections to China’s military sector. DJI’s primary goal in the lawsuit is to have its name removed from the list. The company argues that remaining on the list will continue to cause irreparable damage to its business operations particularly in the U.S. market.
The lawsuit could have far-reaching implications for both the drone industry and U.S.-China relations. If DJI succeeds in removing its name from the Pentagon’s military list, it could regain investor confidence and access to American markets. On the other hand, if the Pentagon's designation is upheld, it may further tighten restrictions on DJI and prompt similar actions against other Chinese companies.
Additionally, this case highlights the growing legal battles between Chinese companies and U.S. regulatory bodies. As the U.S. continues to impose trade and investment restrictions on Chinese firms, more companies may resort to legal challenges in an attempt to protect their business interests and challenge U.S. government actions.
