Hytera's major lawsuit first-instance judgment: pay $50 million to the U.S. government, and nothing to Motorola.

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Hainan Reach Communication Co., Ltd. (Stock Code: 002583, Stock Abbreviation: Hainan Reach) announced a major litigation update on March 12, revealing the verdict of the first instance case related to the U.S. Department of Justice (DOJ) and Motorola. According to the ruling by the U.S. District Court in Illinois, the company is required to pay $50 million to the U.S. government, with no compensation payable to Motorola. The payment must be made after the civil judgment in the trade secret copyright case is fulfilled and no later than the end of 2029.

The announcement states that Hainan Reach has already provisioned $60 million as estimated liabilities in its 2024 annual report, based on the upper limit of the agreement amount reached with the DOJ. Following this judgment, the company will handle the accounting in accordance with enterprise accounting standards but this will not lead to any adjustments in the forecast range of the 2025 performance.

Hainan Reach stated that the company’s production and operations are currently normal, and this judgment will not have a significant impact on current business and normal operations. Over the past year, the company has focused on the annual development theme of “Innovation-led, Development is the Hard Truth,” emphasizing market expansion, operational efficiency improvement, and R&D innovation to lay a solid foundation for long-term, sustainable growth.

It should be noted that the compensation judgment involved in this case is a first-instance ruling, and the final outcome of the case remains uncertain. The company will continue to take necessary legal measures to protect its lawful rights and interests, and will disclose information in a timely manner through interim or periodic reports.

As of now, Hainan Reach has no other major lawsuits or arbitration matters that need to be disclosed but have not been disclosed. Investors are advised to invest rationally and be aware of investment risks.

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Editor: Xiao Lang Kuai Bao