Note: The Skinny blog is written by Rick Smith, editor and co-founder of WRAL Tech Wire and business editor of WRAL.com.

RESEARCH TRIANGLE PARK, N.C. – Let’s all hope that a human rights lawsuit filed against Cisco (Nasdaq: CSCO) is found to be without merit. If the charges are true, then one of the world’s great companies has compromised its values to win business in China.

Members of the Falun Gong in China filed suit last week against Cisco in a U.S. court, alleging that the networking giant assisted the Chinese government in tracking down some of its followers by customizing equipment that makes up part of the so-called “Golden Shield” firewall of China.

John Markoff of The New York Times wrote an in-depth report about the suit.

The company told The Times that there was “no basis” for the suit and vowed a vigorous defense.

The suit cites Cisco marketing materials that include the phrase “douzheng evil Falun Gong cult and other hostile elements.” The Times noted: “Douzheng is a Chinese term used to describe the persecution of undesirable groups. It was widely used by the Communist Party in the Cultural Revolution.”

Only heaven and the Chinese government knows just how many American and other Western corporations have cut corners, turned blind eyes and compromised their beliefs in order develop shareholder value by doing business with the world’s sole remaining communist power.

Google’s bold stand against Chinese censorship and its decision to move operations to the more liberal bastion of Hong Kong from Beijing is an example of one company whose leaders had the guts to just say “no,” although a year ago Google did pledge to obey Chinese law in order to keep practicing business there.

Did Cisco’s leaders kowtow?

Cisco does not “customize our products in any way that would facilitate censorship or repression,” the company told The Times.

The group representing the Falun Gong in the suit differs.

“Terri Marsh, a lawyer for the Human Rights Law Foundation in Washington, said the group had compiled detailed information about Cisco’s role in the design of Chinese information centers that host Falun Gong database applications connected to network surveillance and tracking systems,” The Times reported. “This information will be disclosed in court during the discovery phase of the trial, Ms. Marsh said.”

Cnet, which also reported about the case, said that the suit claims Cisco “competed aggressively” to help design the Golden Shield “with full knowledge that it was to be used for the suppression of the Falun Gong religion.”

The Falun Gong, a “spiritual movement” as The Times describes it, is heavily persecuted in China. Its beliefs are seen as a threat to the Chinese Communist Party’s grip on power.

For the full New York Times report, read here.

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