Motorola 2007 Annual Report Download - page 40

and abetting fraud and conspiracy to defraud and generally makes the same allegations as the other previously-
disclosed cases relating to the In re Adelphia Communications Corp. Securities and Derivative Litigation that have
been transferred to the Southern District of New York. There are no new substantive allegations. The complaint
seeks compensatory damages, opportunity-cost damages, punitive and other exemplary damages and other relief.
In late 2004, the Multi-District Litigation Panel transferred the case to federal court in New York, which transfer
is now final. Motorola filed a motion to dismiss the complaint in this action on September 19, 2005, which is
awaiting decision.
On October 25, 2004, Motorola was named in a complaint filed in state court in Fulton County, Georgia,
naming Motorola and Scientific-Atlanta and certain officers of Scientific-Atlanta, AIG DKR SoundShore Holdings,
Ltd., et al. v. Scientific-Atlanta Inc., et al. The complaint raises claims under Georgia law of conspiracy to defraud
and generally makes the same allegations as the other previously disclosed cases relating to the In re Adelphia
Communications Corp. Securities and Derivative Litigation that have already been filed and transferred to the
Southern District of New York. The complaint seeks damages and statutory compensation, punitive damages and
other relief. On April 18, 2005, the Multi-District Litigation Panel issued a final order transferring the case to New
York and that transfer is final. Motorola filed a motion to dismiss the complaint in this action on September 19,
2005, which is awaiting decision.
Adelphia Communications Corp.—Bankruptcy Court Lawsuit
On June 23, 2006, Adelphia objected to Motorola’s claim for payment of $67 million and asserted causes of
action against Motorola including preferences, avoidance of liens, fraudulent transfers, equitable subordination and
aiding and abetting fraud as part of the ongoing Adelphia bankruptcy action in the Bankruptcy Court for the
Southern District of New York. Plaintiff is alleging damages in excess of $1 billion against Motorola for the above-
stated causes of action.
Intellectual Property Related Cases
Tessera, Inc. v. Motorola, Inc., et al.
Motorola is a purchaser of semiconductor chips with certain ball grid array (“BGA”) packaging from
suppliers including Qualcomm, Inc. (“Qualcomm”), Freescale Semiconductor, Inc. (“Freescale Semiconductor”),
ATI Technologies, Inc. (“ATI”), Spansion Inc. (“Spansion”), and STMicroelectronics N.V. (“STMicro”). On
April 17, 2007, Tessera, Inc. (“Tessera”) filed patent infringement legal actions against Qualcomm, Freescale
Semiconductor, ATI, Spansion, STMicro and Motorola in the U.S. International Trade Commission (the “ITC”) (In
the Matter of Certain Semiconductor Chips with Minimized Chip Package Size and Products Containing Same,
Inv. No. 337-TA-605) and the United States District Court, Eastern District of Texas, Tessera, Inc. v. Motorola,
Inc., Qualcomm, Inc., Freescale Semiconductor, Inc. and ATI Technologies, Inc., alleging that certain BGA
packaged semiconductors infringe patents that Tessera claims to own. Tessera is seeking orders to ban the
importation into the U.S. of certain semiconductor chips with BGA packaging and certain “downstream” products
that contain them (including Motorola products) and/or limit suppliers’ ability to provide certain services and
products or take certain actions in the U.S. relating to the packaged chips. The patent claims being asserted by
Tessera are subject to reexamination proceedings in the U.S. Patent and Trademark Office (“PTO”). In the
reexamination proceedings, the PTO has issued rejections of Tessera’s asserted patent claims. On February 26,
2008, the ITC action was stayed pending the completion of the PTO’s reexamination proceedings.
Motorola is a defendant in various other suits, claims and investigations that arise in the normal course of
business. In the opinion of management, and other than discussed above with respect to the Iridium cases, the
ultimate disposition of the Company’s pending legal proceedings will not have a material adverse effect on the
Company’s consolidated financial position, liquidity or results of operations.
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