Market Overview

ITC Judge Releases Initial Determination in Favor of Motorola Solutions Against Hytera Communications


Judge Finds "Persuasive Evidence" Hytera Copied Motorola Solutions'
Technology and Calls Hytera's Arguments "Disingenuous"

3 Senior Hytera Employees Plead Fifth Amendment to Avoid

Motorola Solutions, Inc. (NYSE:MSI) today announced that Administrative
Law Judge Mary Joan McNamara of the U.S. International Trade Commission
(ITC) has released the Notice of Initial Determination from the ITC's
investigation of the patent infringement complaint filed by Motorola
Solutions against Hytera Communications Corporation Limited (SHE:
002583) on March 29, 2017. In the complaint, Motorola Solutions alleged
that Hytera is unlawfully importing and selling two-way radio equipment
and systems and related software and components that infringe four of
Motorola Solutions' patents.

On July 3, 2018, Judge McNamara found that all four of Motorola
Solutions' patents are valid and that Hytera infringed them. An
exclusion order, preventing the importation of infringing products into
the United States for three of the patents, as well as a
cease-and-desist order (preventing the further sale and marketing of
certain infringing products imported into the United States), continues
to be Judge McNamara's recommendation. The release of the detailed 260
page Initial Determination was ordered by the Judge notwithstanding
Hytera's efforts to redact it extensively.

Relevant highlights from the Notice of Initial Determination are below.
All quotations are verbatim from Judge McNamara (emphasis added in
certain places). The full Initial Determination is available at

There Is "Persuasive Evidence" Hytera Copied Motorola Solutions'

  • Motorola Solutions presented "persuasive circumstantial and
    direct evidence
    " that the Hytera employees "wrongfully
    copied certain of Motorola [Solutions'] patented technologies
  • "Finally, and perhaps the most problematic for Hytera, the evidence
    includes the extent to which each of these Hytera Employees
    plead the Fifth Amendment and declined to answer questions during
    their depositions in this Investigation
    . The questions
    the Hytera Employees were asked clearly were designed to document
    whether they copied and took with them to Hytera any of Motorola
    [Solutions'] proprietary and patented Motorola [Solutions] technology."
  • "In each case, the Hytera Employees refused to answer questions and
    instead invoked their Fifth Amendment right not to incriminate
    themselves. Mr. Y.T. Kok invoked his Fifth Amendment right to
    more than 70 questions
    . Mr. Chia also invoked his Fifth
    Amendment right to more than 70 questions. Mr. G.S. Kok
    invoked his Fifth Amendment right against self-incrimination to
    more than 60 questions

Hytera Employees' Timeline Is "Compelling and Telling"

  • "While Hytera may be correct that there is no direct evidence that the
    three Hytera employees copied the more than 7,000 documents
    they accessed, it is logical to infer that the Hytera Employees
    accessed these documents with the intent of acquiring information
    about Motorola [Solutions'] DMR products for Hytera
    . The
    timing and circumstances of their actions are unequivocal and
  • "That figure bears repeating simply to let sink in the sheer
    magnitude of the number of confidential Motorola documents that the
    Hytera Employees accessed, just before they left Motorola: more than
    7,000 documents. This could not have been coincidental

Hytera Was "Willfully Blind" to Motorola Solutions' Patent Portfolio

  • "Despite knowing about Motorola [Solutions'] patents, and while Hytera unquestionably
    certain of Motorola [Solutions'] patented technologies, Hytera
    acknowledged that it did not take any steps to avoid infringing
    Motorola [Solutions'] patents

Hytera's Arguments Are "Disingenuous"

  • "It is difficult to understand why Hytera continued to maintain
    positions throughout this Investigation that were disingenuous,
    and not supported either factually or legally

"Hytera has built its business by copying the hard work and innovation
of Motorola Solutions. Judge McNamara's findings categorically validate
the merits of Motorola Solutions' global litigation against Hytera to
stop its improper and illegal behavior," said Mark Hacker, general
counsel and chief administrative officer of Motorola Solutions. "We
thank Judge McNamara for both her diligence and the strong, clear
language she used to condemn Hytera's actions. We remain committed to
vigorously protecting Motorola Solutions' intellectual property in the
United States and internationally, and look forward to the final
determination by the ITC."

As the next step in the process, the ITC will conduct a mandatory review
of the Initial Determination. A Final Determination is scheduled to be
issued by Nov. 6, 2018. After the Final Determination is issued, there
is a 60 day presidential review, during which the U.S. President may
modify the ITC's Final Determination. Upon the expiration of that review
period (approximately Jan. 7, 2019), the ITC's exclusion and
cease-and-desist orders will take effect. At such time, at least the
following Hytera products would be excluded from the U.S. market:

  • Subscribers: MD652, MD782, BD302, BD362, BD502, PD412, PD502,
    PD562, PD602, PD662, PD682, PD702, PD752, PD782, PD792, PD982, X1e,
    X1p, and all variants thereof; and
  • Repeaters: RD622, RD982, and all variants thereof.

In addition to the ITC, Motorola Solutions' patent infringement, trade
secret theft and copyright infringement lawsuits against Hytera are
still pending in the U.S. District Court for the Northern District of
Illinois, the Federal Court of Australia and the Regional Courts of
Mannheim and Düsseldorf in Germany.

Motorola Solutions' complaint filed with the ITC, as well as information
on Motorola Solutions' other actions against Hytera, can be accessed at

Forward-Looking Statements

This press release contains certain forward-looking statements including
statements regarding expectations with respect to litigation filed by
Motorola Solutions, Inc., and the outcomes possible if successful. By
their nature, forward-looking statements involve risk and uncertainty
because they relate to future events and depend on circumstances that
will or may occur in the future and are outside the control of Motorola
Solutions, Inc., and its officers. Actual results may differ from those
expressed in such statements depending on a variety of factors including
those discussed in this release.

About Motorola Solutions

Motorola Solutions (NYSE:MSI) creates mission-critical communications
solutions, including devices, networks, software and video, that help
public safety and commercial customers build safer cities and thriving
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