DOJ Failed to Seek Motorola’s Trade Secrets Testimony, Says Hytera Motion to Dismiss
U.S. District Judge John Tharp for Northern Illinois in Chicago must use his “supervisory power” to dismiss the government’s indictment against Hytera Communications for failure to present evidence of trade secrets to the grand jury, said Hytera’s Jan. 11 motion (docket 1:20-cr-00688), originally filed under seal.
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Under the court’s Feb. 23 protective order, the redacted public version of Hytera’s motion was released Friday after no party filed an application of opposition to its release within five business days after service of the sealed motion (see 2401120014). The government’s response to the motion is due Jan. 26 (see 2401160002).
A grand jury in May 2021 returned indictments listing multiple 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 that they took Motorola’s DMR trade secrets with them when they left.
The Fifth Amendment’s requirement that a grand jury receive evidence before indicting isn’t “mere surplusage,” said Hytera’s motion. Here, the grand jurors weren’t presented with evidence “that any information in this case meets the legal definition of a trade secret” under the 1996 Economic Espionage Act (EEA), it said. That renders impossible “the return of an indictment supported by probable cause,” it said.
The theft or possession of information belonging to someone else can’t serve as a basis for prosecution under the EEA unless the information wasn’t generally known and wasn’t readily ascertainable by others through proper means, said the motion. An EEA prosecution also requires that the information derives independent economic value from being secret and was protected with reasonable measures to keep it secret, it said.
The government’s “defective articulation” of the alleged trade secrets in the indictment “leaves unclear which alleged trade secrets Hytera has been charged with stealing and what precisely Hytera must defend against at trial,” said the motion. That vagueness “infected” not only the structure of the indictment, “but also the government’s presentation of evidence to the grand jury,” it said.
Of the 15 “purported” trade secrets the indictment alleges were stolen, the government failed to present any evidence or testimony about six of them to the grand jury, said the motion. For the remaining purported nine, the government “merely asked an FBI agent a series of conclusory hearsay questions,” such as whether Motorola considered certain information to be confidential or proprietary, it said. The government failed to present any evidence that the information was a trade secret as defined in Section 1839 of the EEA, it said.
The government could have called Motorola engineers to the grand jury “to explain, with specific documents, what the alleged trade secrets are in this case,” said the motion. It seems the government “had only a vague and inaccurate sense of the requirements” of the EEA’s Section 1839, it said. 18 U.S.C. § 1839(3). “Perhaps most fundamentally,” it appears that the government “did not know or understand the trade secrets involved,” it said.
The case shouldn’t proceed to trial in light of the “fatal deficiencies” in the indictment and the “unconstitutional presentation” to the grand jury, said the motion. But if it does, the government can’t correct its errors at trial, it said.
The government “is precluded from presenting additional or different evidence about the alleged trade secrets from the evidence it presented to the grand jurors,” said the motion. Doing so would “constructively amend” the indictment and create an “unconstitutional variance,” it said.
Because evidence not presented to the grand jury can’t have formed the basis for the return of the indictment, new evidence presented at trial would have no bearing on the central question of whether the information the indictment alleges was stolen “meets the legal definition of a trade secret” under the EEA’s Section 1839, it said. Admission of such new evidence “would unfairly prejudice Hytera, mislead the jury, and swing the door wide open for a reversal of any conviction the government might obtain,” it said.