ITC initial determination text released for Motorola Solutions vs Hytera complaint (updated)
Written by: Sam Fenwick | Published:
The US ITC's headquarters; credit: Toytoy at the English Wikipedia

The public version of the text of Administrative law judge Mary Joan McNamara of the US International Trade Commission (ITC)’s notice of initial determination for the investigation of the patent infringement complaint filed by Motorola Solutions against Hytera has become available. It states that Hytera employees' access of more than 7,000 confidential Motorola documents “could not have been coincidental”.

While the initial determination’s broad findings were released in July (see this link for more details), the release of the public version of the full text (with multiple redactions due to commercial sensitivities) has added more details. These include the fact that during the proceedings, Mr Shepard, a Motorola Solutions employee responsible for the company’s information technology infrastructure and information security “testified that in combination Mr YT Kok, Mr GS Kok and Mr Chia had accessed a combination of more than 7,000 confidential Motorola [Solutions] documents before the last of the three men left Motorola [Solutions].”

The text goes onto say that “this could not have been coincidental.” Hytera did not contest the veracity of Motorola Solutions’ document access logs or that its employees accessed the documents listed in them on the specific date and times. Instead it argued that Motorola Solutions had no proof that “the employees copied or printed the documents or gave them to Hytera” and that Motorola Solutions was “relying on innuendo rather than facts”.

During their depositions, Mr YT Kok, and Mr Chia invoked their Fifth Amendment right not to incriminate themselves in response to more than 70 questions, while their colleague, GS Kok, did the same in response to more than 60 questions. According to the text, Hytera argued that they did so “to avoid waiving their rights in a parallel, trade secret case Motorola [Solutions] brought against Hytera in Federal District Court.” The company added that because of this case, “these individuals were represented by separate counsel, not under Hytera’s control, who took positions contrary to Hytera’s interests or the wishes of Hytera’s counsel.” It therefore argued that no adverse inference about the employees’ refusal to answer questions about possible theft of Motorola Solutions should be drawn.

However, the text of the initial determination said: “…the totality of [Motorola Solutions’] damaging evidence gives rise to an inference that Messrs GS Kok, YT Kok and Chia did indeed copy some or all of the documents they accessed from [Motorola Solutions’] COMPASS document management system.”

In a statement that was written in response to Motorola Solutions’ press release about the public availability of the initial determination, Hytera said: “Our competitor sought to highlight in particular our employees' choice to invoke the Fifth Amendment in addressing repetitive sequences of questions, though doing so is a well-established privilege in US law and a common practice in legal proceedings.”

The text of the initial determination included the following: “Despite knowing about Motorola’s patents, and while Hytera unquestionably copied certain of [Motorola Solutions’] patented technologies, Hytera acknowledged that it did not take any steps to avoid infringing [Motorola Solutions’] patents… the record evidence demonstrates, and it is a finding of the decision, that Hytera intentionally chose not to take steps to avoid knowledge of [Motorola Solutions’] patented technologies, despite a finding that Hytera did, indeed know about [Motorola Solutions’] patented technologies.”

Motorola Solutions’ patent infringement, trade secret theft and copyright infringement lawsuits against Hytera are still pending in the US District Court for the Northern District of Illinois, the Federal Court of Australia and the Regional Courts of Düsseldorf and Mannheim in Germany. The latter ruled in favour of Motorola Solutions in relation to a patent infringement complaint against Hytera Mobilfunk.

“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 behaviour,” 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.”

Hytera said the following in its statement: “Our competitor's decision to emphasise in isolation aspects of a pending case that seem to favour it instead of Hytera is in keeping with its previous efforts to sway public opinion and affect our relationships with Hytera dealers and their customers. It is consistent with its scheme to leverage every procedural step of multiple litigations against Hytera to maximum negative effect, to enforce their monopolistic grasp on the US market for DMR communications solutions…

“Hytera is in the US market to stay. We do not believe our products infringe our competitor's patents, and we recently debuted new DMR products in the US that we are confident will be attractive to our dealers and customers. Hytera remains committed to supporting our US dealers and customers no matter the outcome of this case.

“What our opponent chose not to include in its selective summary of the initial determination was that ALJ McNamara ruled there was no damage to MSI for some of their intellectual property claims. Far from concurring with MSI’s [Motorola Solutions'] assertion that such intellectual property was key to Hytera’s rise in the market, the Judge determined that MSI could not demonstrate that the asserted technology was even included in their products.

“We are confident that Hytera's new-generation DMR products, debuted in June of this year and with features that will be highly useful to our customers, will allow us to continue to market and sell DMR solutions in the US market and grow our US business whatever the outcome of the ITC proceeding.

“Since MSI petitioned the ITC in March 2017, Hytera has actively defended its rights in accordance with the relevant guidelines of ITC. We will respond to the Commission's pending decisions as appropriate at the time they are issued. Hytera is committed to providing advanced technologies and solutions to improve the communication effectiveness and community security in the US. Our focus remains to empower and protect businesses, industries, and other organisations by furnishing innovative land mobile radio communications products.”

Update – 6 September

The ITC will review in part the initial determination and a final determination was originally scheduled to be issued by 6 November, but a statement from Hytera indicates that this will now be made on 16 November. Hytera had petitioned for the Commission's review on 17 July, citing errors in the initial final determination and arguing that the Commission had reasonable grounds to review substantial elements of it.

"We are pleased that the Commission accepted our petition and we look forward to its final determination with respect to the earlier Initial Determination," said Tom Wineland, vice president of Hytera Communications America (West), Inc., on announcing the ITC's decision.

A Motorola Solutions spokesperson provided the following statement: “Consistent with the findings of Administrative Law Judge [ALJ] Mary Joan McNamara, we are pleased that the ITC has indicated that it will not review numerous aspects of the ALJ’s determinations, including that Hytera infringes all four of Motorola’s asserted patents and that each of those patents is valid, further supporting our allegations and rebuking Hytera for its unscrupulous and unlawful behaviour in wilfully infringing Motorola Solutions’ patents. We respect the Commission’s decision to review certain other aspects of the ALJ’s determinations and look forward to providing the ITC with the information necessary for its review. We are confident that the full ITC will uphold the exclusion and cease-and-desist orders recommended in the Initial Determination, including the two orders under review, in its Final Determination in November.”

Once the final determination has been issued, President Trump will have a 60 day period, during which he may modify the Final Determination. Once that expires and in the event that neither the President nor the ITC have removed the exclusion and cease-and-desist orders that were present in the initial determination will come into effect. At that point, according to a press release from Motorola Solutions, at least the following Hytera products would be excluded from the US 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.

During the ITC investigation, Hytera produced documents and source code related to its new designs to obtain a determination from McNamara. In asking the ITC to review and reverse her initial determination, Hytera petitioned the Commission to review and determine whether these latest redesigned products are not infringing. The company claims that the Commission will revisit the judge's decision with respect to these redesigned products.

"Hytera believes that its products marketed and sold to our many customers in the US do not infringe the patents asserted by [Motorola Solutions]. We are particularly pleased at the forecast scope of the review, which includes the Commission's reviewing why MSI would have asserted patents as infringed that Hytera had previously licensed from [Motorola Solutions] on fair, reasonable, and non-discriminatory terms," says Hytera's Wineland.

Hytera claims that it is common for companies competing in the high-technology sectors to agree to shared standards and for companies to license to and from one another certain so-called "standard-essential" patents on terms described as "fair, reasonable, and non-discriminatory" (FRAND). It adds that two of the patents asserted by Motorola Solutions against Hytera were for technology that Hytera previously had licensed from MSI on such FRAND terms.

"Hytera is focused on innovation for our many customers, in the US and worldwide. We look to compete fairly in the marketplace and to provide high-quality products with a compelling value proposition," adds Wineland. "We look forward to the disposition of this case at the ITC and to resolving the nuisance litigations our competitor has filed against us."

The full text of the public version of the initial determination can be viewed here

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