Walkie-talkie maker appeals US sales ban

Chinese walkie-talkie maker Hytera is appealing against US sanctions that bar it from selling two-way radio products globally as part of a years-long trade secret dispute with Lenovo-backed US smartphone maker Motorola.

The Shenzhen-based firm had complied with the sanctions and suspended the sales of these products, it said in a filing with the Shenzhen exchange yesterday.

“The company will take measures to lift the injunction orders as soon as possible,” Hytera said in the filing, adding there might be “uncertainties” in the development of the case.

The firm was ordered on April 2 by a district court in Illinois to halt the sales and distribution of any products containing two-way radio technology anywhere in the world, according to a statement on Hytera’s website.

The sanctions follow a yearslong trade secret and copyright infringement dispute between Hytera and Motorola, which was acquired by Chinese consumer electronics giant Lenovo Group in 2014.

Motorola filed a complaint against Hytera in 2017, accusing it of infringing on its trade secrets. The US justice department announced charges against Hytera over the alleged theft of trade secrets from Motorola in February 2022. Hytera denied the allegations at the time.

Motorola and Hytera did not immediately respond to a request for comment.

The sanctions represent a significant blow to Hytera’s business, as the firm makes a large chunk of its revenue from developing and selling two-way radio products.

After it was charged in the United States, Hytera filed a case with the Shenzhen Intermediate People’s Court in mid-2022 and sought a judgment that its new H-series products did not infringe Motorola’s trade secrets and copyrights.

The US court in March ordered the company to pay a daily fine of US$1 million until it was in full compliance with the anti-suit injunction orders it issued, which are typically used by a court to prevent shifting legal proceedings to another jurisdiction.

Hytera said yesterday it had dropped its case with the Shenzhen court.

Its shares fell by the daily maximum limit of 10 per cent in Shenzhen yesterday.