Motorola Solutions seeks temporary restraining order blocking Hytera DMR sales

Motorola Solutions has asked a federal judge to block Hytera Communications from selling the bulk of its existing DMR product portfolio for two weeks while considering a permanent injunction—an action that a group of Hytera dealers characterized as “potentially catastrophic.”

On Tuesday, Motorola Solutions filed an application asking Charles Norgle, a judge in the U.S. District Court for the Northern District of Illinois, to issue a temporary restraining order (TRO) prohibiting Hytera Communications, its subsidiaries and “all those acting together with any of them” from selling products that use Motorola Solutions trade secrets or copyrighted software code, which represents most of Hytera’s DMR portfolio.

“Specifically, Motorola respectfully requests that the Court (i) enter a TRO immediately to prevent any further irreparable harm to Motorola, and (ii) set a hearing and briefing schedule on Motorola’s forthcoming motion for a

permanent injunction to occur prior to expiration of the TRO,” according to the Motorola Solutions filing.

It appears that Norgle will conduct a hearing tomorrow to consider the temporary-restraining-order request, although IWCE’s Urgent Communications could not find any court documents explicitly identifying a TRO hearing. However, a Motorola Solutions attorney last week stated that he expected the TRO hearing to be conducted on Feb. 21, a schedule on Norgle’s court web site indicates that a motion hearing is scheduled for tomorrow, and the TRO application appears to be the lone pending motion on the docket.

Motorola Solutions filed for the temporary restraining order on the first business day after an eight-person federal jury unanimously issued a verdict that Hytera Communications stole land-mobile-radio (LMR) trade secrets and infringed upon copyrights owned by Motorola Solutions, awarding the company $418.8 million in punitive damages and $345.8 million in compensatory damages.

Prior to the verdict being announced, Hytera described the eventual $764.6 million award total—the full damages sought by Motorola Solutions—as “bankrupting amounts of money,” according to a report from Law360. But this monetary award would not prevent Hytera from causing Motorola Solutions “immense harm” if the China-based vendor is allowed to continue to sell DMR products that use stolen trade secrets and copyrighted software code, according to the Motorola Solutions filing.

“These are harms that cannot be remedied through a judgment for past damages, even putting aside the likelihood that Hytera will attempt to avoid enforcement of any monetary judgment entered by this Court,” the Motorola Solutions filing states.

“Entry of a worldwide TRO to immediately address Hytera’s complete indifference to the laws protecting Motorola’s trade secrets and copyrights is necessary to stop more irreparable harm from occurring while the parties brief and appear before the Court on a hearing on Motorola’s forthcoming motion for a permanent injunction.”

Soon after last week’s jury verdict was announced, a Hytera spokesperson informed IWCE’s Urgent Communications that the China-based vendor was “considering pursuit of all appeal options.” This week, Hytera definitively indicated its plans to appeal the jury verdict.

“Hytera is disappointed by this court’s verdict, and respectfully disagrees with the jury,” according to a Hytera statement provided to IWCE’s Urgent Communications. “Hytera believes the verdict is unsupported by the evidence presented at trial. Hytera will appeal the verdict and is prepared for the appeal procedures ahead, which may take multiple years. Hytera maintains its faith that the American justice system will ultimately provide a fair outcome in this matter.

“Hytera has enhanced its corporate governance and added new policies and procedures related to intellectual property and the onboarding of new employees. In addition, Hytera is engaged in an ongoing process of removing the affected source code from the products at issue and has been rolling out updated software to the marketplace.”

Hytera filed a brief in opposition to Motorola Solutions’ request for a temporary restraining, but the Hytera brief was sealed to the public.

In contrast, the Dealers Industry Viability Group—a group of 20 Hytera dealers located in 13 states—filed a publicly available amicus brief opposing the TRO request, noting the group’s belief that both Hytera dealers and their customers would suffer significant harm if Norgle grants a permanent injunction preventing the dealers from selling DMR equipment.

“Enjoining sales of DMR products by Hytera, and ‘all those acting together with any of them’ will create havoc in the marketplace, endanger health and safety, and harm dealers and distributors and their customers, who have acted in good faith in purchasing and installing DMR products and have made substantial economic investment in communication systems,” according to the brief filed by the group of Hytera dealers.

Those existing Hytera DMR users include public-safety, transportation, public-school and hospital entities, according to the Hytera dealers group’s filing. For such customers that rely on Hytera DMR systems for critical communications, an injunction from Norgle would be very problematic, the filing states.

“If an injunction is granted, these users will, simply put, be unable to replace repeaters in their system, or to purchase additional radios for their system, creating chaos,” the filing from the Hytera dealers’ group states. “Quite literally, the only choice left to public responders, for example, would be to stop issuing additional radios to its police officers, firemen and paramedics.

“There is a very real risk to public safety from having first responders, hospitals, and similar users unable to communicate. In the public-school example, if a repeater can’t be replaced, the communications systems will be inoperable. Buses will be dispatched without radios; schools will not be able to summon assistance.

“The real-world implications of stopping, overnight, the sales of DMR products are potentially catastrophic.”

In addition, there could be a significant financial impact on existing Hytera DMR customers, according to the filing by the group of Hytera dealers, which contends that DMR systems from Hytera and Motorola Solutions are not interoperable.

“One wonders what the ultimate impact of the proposed injunction would be—would all such users be required to replace their systems with Motorola equipment, at substantial cost to the public?” the dealers’ group filing states. “One dealer estimates it would cost a large public-school system between $900,000 and $1 million to replace its system with a Motorola system.

“The proposed injunction simply acts to prevent competition in the marketplace, reducing the choices afforded the ultimate clients and customers to select between competing products. As a practical matter, the proposed injunction simply creates business for Motorola and its system of dealers and distributors.”

In its TRO filing, Motorola Solutions opposed the notion that competitive factors should prevent Norgle from granting the company’s TRO request.

“The potential for lower prices is not a legitimate justification for allowing ongoing use of stolen technology,” the Motorola Solutions filing states.

“In any case, Motorola is easily capable of satisfying any demand for new Motorola DMR products and systems caused by entry of a TRO; moreover, because Motorola’s and Hytera’s DMR products are interoperable, Motorola’s products are more-than-adequate substitutes for any of Hytera’s customers’ needs, including any public safety, health care, or similar customers.”