EXCLUSIVE: Pete Hegseth Hit With Lawsuit Over Pentagon's Stunning Chinese Military Blacklist U-Turn
Pete Hegseth is facing a federal lawsuit over the Pentagon's decision to put Chinese chipmaker CXMT back on its military blacklist after previously moving to remove the company.
Sept. 9 2026, Published 5:29 p.m. ET
Pete Hegseth has been dragged into a federal court battle after a major Chinese chipmaker accused the Pentagon of making a stunning U-turn — first deciding to take the company off a military blacklist, then putting it right back on months later, RadarOnline.com can exclusively reveal.
ChangXin Memory Technologies, Inc., known as CXMT, filed a lawsuit against the U.S. Department of Defense, Hegseth and other Pentagon officials over the company's designation as a "Chinese Military Company"— a Pentagon label for businesses the U.S. government believes have qualifying ties to China's military or defense apparatus.
Companies on the list face serious consequences, including being barred from certain federal contracts.
CXMT Claims Pentagon Got Key Facts Wrong
Pete Hegseth is among the Pentagon officials sued by CXMT
According to court documents obtained by Radar, CXMT claims the Defense Department initially placed it on the blacklist in January 2025, accusing the semiconductor manufacturer of ties to China's military and government.
But the company insists the Pentagon got key facts wrong.
One of the most eye-catching disputes centers on an advertisement describing CXMT products as "military grade."
The chipmaker claims the wording came from an unauthorized distributor that later admitted the description was incorrect.
Pentagon's Stunning U-Turn
CXMT says the Pentagon appeared ready to remove it from the Chinese military blacklist in February.
CXMT spent more than a year trying to convince Pentagon officials to reconsider the designation — and for a brief moment, it appeared to have worked.
On February 13, 2026, the Defense Department posted a notice saying CXMT was among the companies that "should be removed" from the military list.
Then came the dramatic reversal.
The Pentagon withdrew the notice later that same day without publicly explaining why, according to the lawsuit.
CXMT said it repeatedly asked officials what had changed and requested a chance to respond to any new evidence, but claims the department refused to provide details and eventually stopped communicating with the company.
CXMT Questions White House Role in Pentagon Reversal
The Pentagon put CXMT back on its Chinese Military Company list in June.
Four months later, on June 8, the Pentagon put CXMT back on the blacklist.
The company claims the new explanation relied largely on information the government already had when it previously decided CXMT should be removed — fueling its allegation that the reversal was not based on fresh evidence.
The lawsuit also raises questions about possible White House involvement.
CXMT points to previous reporting claiming White House officials objected to removing the company and another Chinese chipmaker from the list amid wider U.S.-China trade tensions.
The company alleges political considerations may have influenced the Pentagon's change of course, though those claims have not been proven in court.
CXMT Seeks to Overturn Pentagon Blacklist Designation
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CXMT claims the blacklist has hurt its business and damaged its reputation.
CXMT is also challenging another Pentagon allegation linking it to China's Ministry of Industry and Information Technology through an area known as "China Sound Valley."
The company claims it does not operate there and says the Pentagon failed to produce evidence supporting that connection.
CXMT says the blacklist has already hurt its business, prevented it from pursuing certain federal contracts and damaged its reputation by effectively branding the company a national-security threat.
The company now wants a federal judge to throw out the Pentagon's designation and block officials from continuing to treat CXMT as a Chinese Military Company.
