Hytera Files 3 Motions to Dismiss Trade Secrets Indictment on Various Grounds
Hytera Communications filed three pretrial motions Friday in U.S. District Court for Northern Illinois in Chicago (docket 1:20-cr-00688) to dismiss the government's theft of trade secrets criminal indictment against the company on various grounds.
One motion argues the indictment is barred by the statute of limitations, another says the indictment lacks extraterritorial application, and a third argues the trade secret allegations are unconstitutionally vague. Hytera also filed under seal a fourth motion to dismiss the indictment based on defects in the grand jury proceedings.
A grand jury returned an indictment in May 2021 listing 22 counts of trade secret theft against Hytera and seven of its engineers who developed digital mobile radios for Motorola in Malaysia beginning in 2004 (see 2301260060). The engineers quit Motorola in 2008 and 2009 to go to work for Hytera in Shenzhen, and the government alleges they took Motorola’s DMR trade secrets with them.
Hytera’s “purported crime” was “fully complete” by 2010, when Hytera’s alleged intent to convert the trade secrets and harm Motorola ended, and “when the objective of the charged conspiracy was achieved,” said the motion making the statute of limitations argument. But the indictment was issued in 2021, more than a decade later, it said: “The applicable five-year statute of limitations thus serves as a total bar to the charges in this case.”
Possession of trade secrets under the Economic Espionage Act isn’t “a continuing offense for statute of limitations purposes,” said the motion. “To the contrary, the legislative history of the EEA, as well as relevant case law, make clear that the EEA criminalizes the initial taking of trade secrets with the intent to convert them, not their continued use and indefinite possession,” it said. The EEA’s criminal provisions “stand in stark contrast” to its “sister civil statute,” the Defend Trade Secrets Act, “which includes a specific provision extending the statute of limitations,” it said: “Had Congress meant to make the EEA a continuing offense, like it did the DTSA, it would have explicitly done so.”
The alleged theft took place entirely in Asia well over a decade ago, said Hytera’s second second motion to dismiss because the charges don’t state an extraterritorial offense. Because the government’s allegations can’t meet the EEA’s requirements for extraterritorial application, the indictment “fails to state an offense and should be dismissed,” it said. “At bottom,” the case is about an alleged theft that occurred in Malaysia, “and an alleged use of the stolen information to develop a competing product in China,” it said. Because the indictment fails to allege “any relevant activities” in the U.S., “it must be dismissed in its entirety,” it said.
The indictment purports to charge Hytera and the former Motorola employees with stealing, copying and possessing 15 trade secrets in violation of federal law, said the third motion to dismiss based on the unconstitutional vagueness of the allegations. The indictment fails to identify “a single actual” trade secret, it said.
The indictment instead lists 15 “vague and overlapping categories of technical data,” claiming those are the purported trade secrets, it said. But none of those “broad categories of data” could possibly amount to a trade secret, it said. They not only lack specificity, but also most of the information described in them is “publicly known and therefore incapable” of being a trade secret, it said. The indictment “thus fails to identify the very information that the government alleges was stolen in this case,” it said.