Trade Shows as a Toehold: Motorola v. Hytera and the DTSA's Reach Across Borders

A jury in Chicago found that a Chinese radio maker had built its product line on trade secrets stolen by three engineers it poached from Motorola, and then awarded three-quarters of a billion dollars. The hard legal question on appeal was not whether Hytera stole anything, but whether a United States statute could reach misappropriation and sales that happened largely overseas. In Motorola Solutions, Inc. v. Hytera Communications Corp., 108 F.4th 458 (7th Cir. 2024), the Seventh Circuit answered yes, holding that the Defend Trade Secrets Act (DTSA) applies extraterritorially when an “act in furtherance” of the misappropriation occurs on American soil. The toehold here was as ordinary as a trade-show booth.

At a glance

• Case: Motorola Solutions, Inc. v. Hytera Communications Corp., Nos. 22-2370 & 22-2413 (7th Cir. July 2, 2024), 108 F.4th 458.
• Court: U.S. Court of Appeals for the Seventh Circuit; opinion by Judge David F. Hamilton, joined by Judges Brennan and St. Eve. On appeal from the U.S. District Court for the Northern District of Illinois.
• Posture: Cross-appeals from a jury verdict finding violations of the DTSA and the Copyright Act and a multi-hundred-million-dollar damages award.
• Holding: The DTSA can apply to foreign misappropriation where a domestic act in furtherance of the offense occurs; the court affirmed roughly $407 million in DTSA damages based partly on worldwide sales, but reversed in part on copyright and remanded for recalculation limited to domestic sales. It also reversed the denial of Motorola’s Rule 60(b) motion and sent the question of permanent injunctive relief back for reconsideration. The Supreme Court denied Hytera’s certiorari petition on February 24, 2025.
• Significance: A leading appellate decision on the DTSA’s extraterritorial reach, holding that even limited U.S. conduct can support global trade-secret damages.

The theft and the verdict

Hytera Communications, a Chinese competitor in the two-way radio market, recruited three engineers away from Motorola. Before leaving, the engineers downloaded thousands of documents and files containing Motorola’s trade secrets and copyrighted source code. Using that material, Hytera launched a line of digital mobile radios that the evidence showed were functionally indistinguishable from Motorola’s products. Motorola sued in the Northern District of Illinois, and a jury found that Hytera had violated both the DTSA and the Copyright Act, awarding compensatory damages under the Copyright Act and both compensatory and punitive damages under the DTSA: a total in the neighborhood of $765 million before post-trial adjustments.

The central appellate fight was reach. Much of the misappropriation and most of Hytera’s sales occurred outside the United States. Hytera argued that the DTSA, like most federal statutes, is presumed not to apply extraterritorially and could not support damages measured by foreign sales. The court had to decide whether the statute overcame that presumption and, if so, how far.

The two-step extraterritoriality analysis

Applying the familiar RJR Nabisco framework, the Seventh Circuit asked first whether Congress gave a clear, affirmative indication that the DTSA applies extraterritorially. It found one, not in the DTSA’s own operative text alone but in its statutory home. Congress enacted the DTSA as an amendment to the Economic Espionage Act, and the EEA contains an express extraterritoriality provision, 18 U.S.C. § 1837, reaching conduct outside the United States when “an act in furtherance of the offense was committed” in the United States. Because the DTSA was grafted onto that framework, the court reasoned, it carries the same extraterritorial authorization.

The second step asked whether this case fell within that authorization: whether a domestic act in furtherance had occurred. It had. Hytera advertised, marketed, and promoted the infringing radios to prospective customers at trade shows inside the United States. That domestic promotional activity, the court held, was a domestic “use” of the trade secrets that amounted to completed acts of misappropriation under 18 U.S.C. § 1839(5)(B), and so was “not just a domestic ‘act in furtherance of’ misappropriation but was itself a complete domestic act of misappropriation.” That was more than enough to satisfy § 1837(2) and bring Hytera’s foreign conduct, and the worldwide sales that flowed from it, within the statute’s reach. The striking feature of the holding is how little domestic activity it required: not the theft, not the manufacture, not even most of the sales, but the marketing of the stolen-technology products at U.S. trade shows.

Damages, punitive multiples, and the copyright remand

Having upheld extraterritorial application, the court affirmed the DTSA award of roughly $407 million (about $135.8 million in compensatory damages and $271.6 million in punitive damages) calculated in part on Hytera’s worldwide profits. It rejected Hytera’s Fifth Amendment due process challenge to the punitive component, which was “exactly double” the compensatory award and therefore sat right at the statutory ceiling of twice the compensatory damages under 18 U.S.C. § 1836(b)(3)(C), given the findings of willful and malicious misappropriation.

The copyright claim fared differently, and the contrast is instructive. The Copyright Act, the court held, contains no comparable extraterritorial authorization, and Motorola had not established a qualifying domestic act of infringement to anchor a worldwide award. The court therefore reversed in part and remanded the $136.3 million copyright award with instructions to recalculate it limited to Hytera’s domestic sales and to reconsider apportionment, predicting the figure would shrink substantially, “perhaps by roughly an order of magnitude.” The juxtaposition makes the point: two intellectual-property regimes, litigated on the same facts, produced opposite extraterritorial results because only one was tied to a statute authorizing foreign reach. Hytera petitioned the Supreme Court for certiorari to challenge the DTSA ruling, and the Court denied the petition on February 24, 2025 (No. 24-725), leaving the Seventh Circuit’s holding and the roughly $407 million DTSA award in place.

Open questions

• How thin can the domestic act be? Trade-show marketing sufficed here; future cases will test whether still slighter U.S. contacts can anchor worldwide damages.
• Will other circuits agree? The Seventh Circuit called the question one of first impression for any circuit, and the Supreme Court declined to take it up in February 2025. Another circuit reaching a different answer is the most likely route to further review.
• How are worldwide damages apportioned? The opinion approves global sales as a damages base but leaves room to argue about causation and the share of foreign profits fairly attributable to the misappropriation.

Implications

• Limited U.S. conduct, global exposure. A foreign defendant that markets stolen-technology products at U.S. trade shows may face DTSA damages measured by worldwide sales.
• The EEA link is the key. The DTSA’s extraterritorial reach derives from the Economic Espionage Act’s act-in-furtherance provision, not from the DTSA’s stand-alone text.
• Copyright is not coextensive. The same facts yielded a domestic-only copyright recovery, underscoring that extraterritorial reach is statute-specific.
• Punitive exposure is real. Willful and malicious misappropriation can support punitive damages up to twice the compensatory award.
• Plan cross-border defense early. Foreign companies competing in the U.S. should assume that any domestic marketing footprint can become the hook for sweeping trade-secret liability.

Frequently asked questions

Does the Defend Trade Secrets Act apply to misappropriation that happens overseas? Yes, within limits. The Seventh Circuit held the DTSA can reach foreign misappropriation when an act in furtherance of the offense occurs in the United States, drawing on the Economic Espionage Act provision the DTSA amended. Advertising stolen-technology products at U.S. trade shows qualified.

How large was the award and what happened to it on appeal? The court affirmed roughly $407 million under the DTSA, comprising about $135.8 million in compensatory damages and $271.6 million in punitive damages, based partly on Hytera’s worldwide sales. It separately reversed in part on the $136.3 million copyright award and remanded for recalculation limited to domestic sales. The Supreme Court denied Hytera’s certiorari petition on February 24, 2025, so the DTSA award stands.

What is the practical takeaway for foreign companies? Even limited U.S. activity, such as marketing or attending trade shows with products built on stolen secrets, can trigger DTSA liability measured by global sales. Foreign firms cannot assume that keeping the actual theft abroad shields them from U.S. trade-secret damages.

Authorities and sources

• Slip opinion (GovInfo PDF), Motorola Solutions, Inc. v. Hytera Communications Corp., Nos. 22-2370 & 22-2413 (7th Cir. July 2, 2024): https://www.govinfo.gov/content/pkg/USCOURTS-ca7-22-02413/pdf/USCOURTS-ca7-22-02413-0.pdf
• Supreme Court docket, Hytera Communications Corp. v. Motorola Solutions, Inc., No. 24-725 (cert. denied Feb. 24, 2025): https://www.supremecourt.gov/docket/docketfiles/html/public/24-725.html
• Defend Trade Secrets Act remedies, 18 U.S.C. § 1836 (Cornell LII): https://www.law.cornell.edu/uscode/text/18/1836
• Economic Espionage Act extraterritoriality, 18 U.S.C. § 1837 (Cornell LII): https://www.law.cornell.edu/uscode/text/18/1837
• Definition of “misappropriation,” 18 U.S.C. § 1839 (Cornell LII): https://www.law.cornell.edu/uscode/text/18/1839