A screenshot from Hytera's official website

Shenzhen-based Hytera, one of China's major communications equipment makers, announced on Monday that it had suspended legal action against Motorola in a Shenzhen court, while suspending the sale of two-way radio technology products as required by a US court.

The company's announcement came after that the US District Court for the Northern District of Illinois temporarily enjoined it from sales and distributing only Two-Way Radio Products anywhere in the world, pending Hytera's full compliance with the US Court's anti-suit injunction orders.

Specifically, the incident stems from a patent dispute between Hytera and Motorola. In June 2022, Hytera filed a lawsuit in the Shenzhen court seeking a declaratory judgment that its H-series products did not infringe on Motorola Solutions' trade secrets and copyrights. The Shenzhen court agreed to hear its claim in February 2023 and requested that Motorola provide rebuttal evidence by April 1, 2024.

After that case went to trial, Motorola filed a motion for injunction in the US court, requesting that Hytera withdraw its complaint in the Shenzhen case, and the US court granted the motion on March 25, 2024.

According to the judgement of the US court, an injunction and additional sanctions are imposed on Hytera in order to coerce Hytera's compliance with the anti-suit injunction orders that the court has entered regarding the litigation Hytera filed in the Shenzhen Intermediate People's Court in June 2022.

Until further notice, Hytera is prohibited from selling any products containing Two-Way Radio technology anywhere in the world, and is hereby ordered to pay a daily fine to the Court of $1 million until the company is in full compliance with the court's anti-suit injunction orders, read the judgement. In addition, the firm is hereby ordered that it may not enforce or otherwise rely on any orders or judgments issued by the Shenzhen court.

In response, Hytera emphasized that it will take various countermeasures to strive for the shortest possible time to revoke the judgment, but there exists uncertainty in the subsequent progress of the case.

The stock of Hytera dived by its maximum limit during opening at 4.24 yuan per share on Monday.

The conflict between Hytera and Motorola can be traced back as far as seven years ago. In March 2017, Motorola accused the Chinese company of infringing trade secrets and US copyrights. In February 2020, a jury in the US court found that Hytera was guilty of infringing one or more of Motorola's trade secrets and US copyrights, ordering it to pay to Motorola infringement damages in the amount of $345,76 million and punitive damages in the amount of $418,88 million.

The two parties reached an agreement in January 2021 to reduce the overall compensation from $765 million to $543 million. In July 2022, Hytera was required to pay Motorola additional trade secret and copyright infringement royalties from July 2019 onwards.

Hytera has begun counterclaims against Motorola in China. From 2017 to 2022, the company has sued Motorola in Beijing, Guangzhou, and Shenzhen. According to the latest announcement released by Hytera, it was the Shenzhen lawsuit that triggered the US court's latest order.

Global Times