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Hytera America Filed For Chapter 11 Bankruptcy Due To Motorola Solutions' Litigation Woes

Date:May 27, 2020

(Source: urgentcomm.com)

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On May 27, Hytera America applied for Chapter 11 bankruptcy protection, a move to resolve financial issues related to ongoing litigation and the impact of the COVID-19 pandemic on its US business.


Hytera ’s announcement on the Hytera America website today states that Hytera filed a voluntary petition for Chapter 11 bankruptcy relief with the Central California Bankruptcy Court, “the purpose is to maintain its operations in the United States.


"In the past two decades, Hytera has started to work with US distributors to bring the most innovative and valuable land mobile radio (LMR) solutions to the market, while constantly seeking to improve support for our distributors and customers. Service, "Alla Huang, Hytera's US president, said in a prepared statement.


"We will continue to uphold the tradition of excellence and have confidence in the future of sustainable growth. We look forward to introducing our new product lines, such as Hytera HALO National Group Communications, PoC hardware, software and cloud services total solutions, facial recognition and Integrated access control solution for temperature measurement and next-generation digital mobile radio. "


Hytera America ’s online statement stated, “Hytera America ’s“ services and support for distributors and customers should be almost uninterrupted during the reorganization process. ”Hytera believes that after the reorganization process is completed, its operations will remain viable in the US market . "


Hytera America ’s bankruptcy application was executed in less than three months, after the US District Court Illinois District Judge Charles Norgle issued a judgment in March asking Hytera to pay Motorola Solutions $ 345.8 million in compensation and 418.8 million Punitive damages in US dollars.


According to reports, during the trial, a Hytera lawyer described the financial compensation sought by the Motorola solution as the “bankruptcy amount”. In February, the jury unanimously decided that Motorola Solutions should seek all compensation, and Norgle confirmed the verdict.


The Motorola solution is also seeking a post-trial ruling for a permanent ban, which will prohibit Hytera from selling its large number of DMR products anywhere in the world. Hytera's lawyer is seeking a new trial. In addition, Hytera argues that any U.S. ruling should apply only to U.S. operations of Hytera and not to the company ’s activities in other countries around the world.


According to the joint status report filed by the two companies in the Federal Court of Chicago earlier this month, the lawyers for Hytera and Motorola Solution are scheduled to hold a mediation meeting on Thursday. A source familiar with the case pointed out that the two parties had previously participated in the mediation meeting during the litigation, but did not reach any broad resolution to the most important dispute in the case.


If no settlement agreement is reached, Hytera will be required to submit a brief statement in opposition to the permanent ban imposed by Motorola Solutions. The deadline for Motorola ’s solution to submit a response on this matter is June 23. At that time, the restraining order will be left to the judge.


During the trial, Attorney Hytera admitted that three former Motorola employees-Samuel Chia, YT Kok and GS Kok-visited more than 7,000 Motorola documents before they each left and joined Hytera in 2008.


In contrast, the Motorola solution requires that China ’s Hytera should pay more economic incentives, including the profits, interest and attorney fees that Hytera has realized since the trial began.


Hytera America's online statement indicated that another reason why LMR filed Chapter 11 bankruptcy was the impact of the COVID-19 pandemic, but the statement did not determine how the health crisis would negatively affect the company. Hytera's statement does outline some of the company's actions related to fighting the pandemic.