Hytera pleads guilty to criminal conspiracy, must make ‘full restitution’ to Motorola Solutions

LMR manufacturer Hytera Communications will pay a fine up to $60 million and must make “full restitution” to Motorola Solutions after pleading guilty to conspiring to steal DMR trade secrets from Motorola more than 16 years ago, according to a plea agreement released today by the U.S. Department of Justice (DoJ).

Exact financial terms associated with the plea deal will be determined by U.S. District Court Judge John Tharp during sentencing, according to a DoJ press release about the matter. The sentencing hearing is set for Nov. 6, the DoJ press release states.

“According to the plea agreement, Hytera, through the acts of individuals acting to benefit the company, knowingly conspired to steal at least one trade secret from Motorola,” according to the DoJ press release. “In 2008, the individuals agreed to take documents and source code related to Motorola’s digital-mobile-radio [DMR] technology, and then used some of that information to develop Hytera products, some of which were later sold in Illinois, the plea agreement states. 

“Hytera stated in the plea agreement that the individuals knew and/or reasonably believed that some of the information they agreed to steal was reasonably protected and kept secret by Motorola, and that taking at least one trade secret would potentially injure Motorola.”

As a result of the plea agreement, a criminal trial that was scheduled to begin on Feb. 4—and expected to last at least four weeks—has been stricken, according to the federal district court in Chicago. Under the plea agreement, Hytera Communications forfeits its right to appeal regarding the criminal case.

This plea deal is the result of a 21-count indictment that was partially unsealed in a federal court in March 2022, the DoJ alleged that Hytera Communications and seven individuals conspired to steal DMR trade secrets from Motorola (the company’s name when the alleged theft occurred).

Each of the alleged individual co-conspirators—Gee Siong Kok (G.S. Kok), Yih Tzye Kok, Samuel Chia Han Siong, Phaik Ee Ooi, Wong Kiat Hoe, Yu Kok Hoong, and Chua Siew Wei—were initially Motorola employees in Malaysia. Each of these individuals participated in a scheme to copy Motorola DMR trade secrets while still at Motorola and provide the information to Hytera upon being hired by the China-based LMR company.

With this trade-secret information, Hytera was able to accelerate its development of DMR offerings, which proved to be among the popular products for the company during its ascension during the 2010s.

Hytera Communications attorneys have long acknowledged the facts of the trade-secret theft and the company’s use of the DMR information, but they have attributed this to the actions of “rogue” employees, not something in which the Hytera company participated. In the plea deal, Hytera Communications agreed that the company was guilty of conspiring to steal trade secrets from Motorola.

“Defendant [Hytera Communications] admits that these facts establish its guilt in the … case,” according to the plea agreement.

Hytera Communications attorneys also have questioned whether all of the information stolen from Motorola actually were trade secrets—a matter in dispute that could impact the amount of money Hytera ultimately will be required to pay Motorola Solutions.

“Defendant reserves the right to challenge at sentencing whether the trade secrets alleged by the government are, in fact, trade secrets,” according to the plea agreement.

Hytera Communications provided the following comment about the plea agreement.

"Hytera Communications Corporation Ltd. is pleased that the U.S. Attorney's Office agreed to drop 20 out of the 21 criminal counts against Hytera, along with the forfeiture count, and reduced the maximum proposed fine from approximately $900 million down to $60 million," according to the Hytera Communications statement. "Nearly 20 years ago, seven former Motorola engineers in Malaysia stole certain of Motorola's technology related to DMR radios and then joined Hytera. In pleading guilty today to one count of conspiracy to steal trade secrets, Hytera accepts corporate responsibility for those former Motorolans' bad acts and looks forward to putting this unfortunate chapter behind it."

Motorola Solutions Chairman and CEO Greg Brown applauded the DoJ for pursuing criminal charges against Hytera Communications.

“Hytera‘s admission of guilt in federal court validates the extensive evidence that it is a bad actor and felon, and we remain firmly resolute to holding Hytera accountable for its egregious illegal conduct,” Brown said in a prepared statement. “I appreciate the Department of Justice for its diligence in pursuing this matter.

“This case is critical validation that our government is fully committed to prosecuting criminals who steal from American companies. We will continue to vigorously defend our valuable intellectual property and trade secrets for the benefit of our company, our customers and our shareholders.” 

A Motorola Solutions press release about the plea agreement noted that Hytera Communications “entered a felony guilty plea” and that this criminal case is separate from the civil case between the companies that was initiated in March 2017. Hytera was found guilty in the civil case early in 2020.

“Hytera’s guilty plea does not resolve Motorola Solutions’ ongoing civil litigation against Hytera,” the Motorola Solutions press release states. “Motorola Solutions is continuing to pursue collection of the more than $471 million judgment already awarded to it in its trade-secret and copyright-infringement litigation against Hytera in the United States, as well as injunctive and other relief to address Hytera’s misconduct.”

Under the plea agreement, Hytera Communications will be required to pay a fine of $60 million or less, based on the determination of Judge Tharp. This amount is significantly less than the fine range of  $453.78 million to $907.56 million that DoJ cited in its sentencing-guidelines calculations—figures that are disputed by Hytera, according to the plea agreement.

In addition, the plea agreement requires the federal district court to order Hytera Communications and any jointly liable co-defendants “to make full restitution to Motorola in an amount to be determined by the Court at sentencing.”

The plea deal also includes a timetable for the sentencing of Hytera Communications.

“Defendant [Hytera Communications] agrees to be sentenced no later than December 1, 2025, and it agrees further that a failure to reach a settlement with Motorola is not a basis on which to seek a continuation of the sentencing beyond December 1, 2025,” according to the plea agreement.