Important Legal Issues for Telecom Companies to Address in the Near Future: Motorola

A series of posts are being issued on recent filings from major telecommunications companies with the United States Securities and Exchange Commission. Companies listed on the New York Stock Exchange are required to list all known business risks for their investors. The following extracts are from the 10-K annual reports of these companies -- the 10-K "provides a comprehensive overview of the company for the past year". Thank you to Artists Against Wi-Fi for this information.

Following is the filing of Motorola including legal proceedings.

Damages cited in these proceedings include:
- failure to incorporate a remote headset into cellular phones or warning against using a phone without a headset rendered the phones defective by exposing users to alleged biological injury and health risks
- use of a cellular phone caused a malignant brain tumor
-  defendants provided false and misleading information about cell phones or omitted to disclose material information
- defendants failed to disclose the alleged "debate" related to the safety of wireless phones reflected in studies that allegedly show wireless phones can cause harm. 

Some of the plaintiffs are seeking damages of up to $100 million.




MOTOROLA:
Allegations of health risks with using Motorola Mobility products, and the lawsuits and publicity relating to them, regardless of merit, could negatively impact our business, operating cash flows and financial condition.

Assertions about health and safety, hazardous materials usage and other environmental concerns related to using Motorola Mobility products could adversely impact our business, operating cash flows and financial condition. Adverse factual developments or lawsuits against us, or even the perceived risk of adverse health effects from chemical or physical agents associated with the use of smartphones or other devices we sell could negatively impact sales, subject us to costly litigation and/or harm our reputation, business, operating cash flows and financial condition.

There has been public speculation about possible health risks to individuals from exposure to radio frequency energy from the use of mobile devices. Government agencies, international health organizations and other scientific bodies are currently conducting research into these issues. In addition, we have been named in individual plaintiff and class action lawsuits alleging that radio frequency emissions from mobile phones have caused or contributed to brain tumors, and that the use of mobile phones poses a health risk.

There has been significant scientific research by various independent research bodies that has indicated that exposure to electromagnetic fields or to radio frequency energy, at levels within the limits prescribed by public health authority standards and recommendations, presents no known adverse effect to human health. Nevertheless, there can be no assurance that other studies will not suggest or identify a link between electromagnetic fields or radio frequency energy and adverse health effects or that we will not be the subject of future lawsuits relating to this issue. See "Item 3. Legal Proceedings".

Item 3: Legal Proceedings
Personal Injury Cases
Cases relating to Wireless Telephone Usage

Farina v. Nokia, Inc., et al.
On April 19, 2001, Farina v. Nokia, Inc., et al., was filed in the Pennsylvania Court of Common Pleas, Philadelphia County. Farina, filed on behalf of a Pennsylvania class, claimed that the failure to
incorporate a remote headset into cellular phones or warning against using a phone without a headset rendered the phones defective by exposing users to alleged biological injury and health risks and
sought compensatory damages and injunctive relief. After removal to federal court, transfer and consolidation with now-dismissed similar cases, an appeal, remand to state court and a second removal, the case proceeded in the federal district court in Philadelphia. The original complaint was amended to add allegations that cellular telephones sold without headsets are defective because they present a safety risk when used while driving. In the current complaint, Plaintiff seeks actual damages in the form of the greater of $100 or the difference in value of a Motorola phone as delivered and with a headset, the amount necessary to modify the phones to permit safe use, out of pocket expenses, including the purchase of headsets, treble damages and attorney's fees and costs. On September 2, 2008, the federal district court in Philadelphia dismissed the Farina case, finding that the complaint is preempted by federal law. On October 22, 2010, the U.S. Court of Appeals for the Third Circuit affirmed the dismissal of the complaint. On February 22, 2011, Plaintiff filed a petition for writ
of certiorari to the U.S. Supreme Court. On October 3, 2011, the U.S. Supreme Court denied plaintiff's petition for writ of certiorari. The decision of the Court of Appeals dismissing the complaint is final.

The Murray Cases
During 2001 and 2002, several cases were filed in the Superior Court of the District of Columbia alleging that use of a cellular phone caused a malignant brain tumor: Murray v. Motorola, Inc., et al.,
filed November 15, 2001; Agro, et al. v. Motorola, Inc., et al., filed February 26, 2002; Cochran, et al. v. Audiovox Corporation, et al., filed February 26, 2002, and Schofield, et al. v. Matsushita Electric
Corporation of America, et al., filed February 26, 2002 (collectively the "Murray cases"). Each complaint seeks compensatory damages in excess of $25 million, consequential damages in excess of $25 million and punitive and/or exemplary damages in excess of $100 million. After removal to federal court, transfer, consolidation and remand, the defendants moved to dismiss the Murray cases on November 30, 2004. On August 24, 2007, the Superior Court granted the defendants' motion and
dismissed the cases with prejudice on federal preemption grounds. On September 20, 2007, Plaintiffs appealed the dismissal to the District of Columbia Court of Appeals. On October 30, 2009, the Court of Appeals affirmed the decision in part and reversed the decision in part. The Court affirmed dismissal
of claims challenging the adequacy of the FCC's Standards on conflict preemption grounds. The Court also held that Plaintiffs' claims may not be preempted to the extent they are based on allegations that
their injuries were caused by wireless phones that did not comply with the FCC's Radio Frequency ("RF") exposure standards passed in 1996 (regardless of when Plaintiffs purchased their phones). The Court further held that claims asserted under DC Code Section 28-3904 (DC unlawful trade practices act) alleging that defendants provided false and misleading information about cell phones or omitted to disclose material information may not be preempted if Plaintiffs are able to base their claims on allegations that do not challenge the adequacy of the FCC's safety standards. The Court remanded the cases to the Superior Court. On May 3, 2010, Plaintiffs filed amended complaints. Plaintiffs'
amended complaints assert the same claims raised in their previous complaints but purport to limit their claims to those involving: (1) phones manufactured before the FCC adopted its Specific Absorption Rate standards in 1996; (2) post-1996 phones that do not comply with the FCC's standards; and (3) allegedly non-preempted claims soundingin misrepresentation, non-disclosure, and failure to warn. Plaintiffs have not changed their allegations regarding the Motorola phones they
allegedly purchased and used, other than to assert that none of the Motorola phones they purportedly purchased was compliant with the FCC's Specific Absorption Rate standards. Plaintiffs seek the same
damages as in the original complaints. On August 31, 2011, plaintiffs filed amended complaints, dropping claims related to District of Columbia's Consumer Protection Procedures Act and retained other claims. Plaintiffs' amended complaint seeks the same damages as the initial complaint discussed
above.

The Marks Case
On May 5, 2010, Alan and Ellen Marks filed suit in the Superior Court of the District of Columbia, Alan Marks, et. al v. Motorola, Inc., et. al., alleging that use of a cellular phone caused Alan Marks'
malignant brain tumor ("Marks Case"). The complaint is based on the same legal theories and factual allegations as the Murray cases and seeks compensatory damages of $25 million, consequential damages in excess of $25 million and punitive and/or exemplary damages of $100 million. On August 31, 2011, plaintiffs filed an amended complaint based on the August 31, 2011 Murray complaint.

The Kidd Case
On October 22, 2010, Shawn and Alisha Kidd filed suit in the Superior Court of the District of Columbia, Shawn Kidd, et. al. v. Motorola, Inc., et. al., alleging that use of a cellular phone caused Shawn Kidd's malignant brain tumor ("Kidd Case"). The complaint is based on the same legal theories and factual allegations as the Murray cases and seeks compensatory damages of $25 million, consequential damages in excess of $25 million and punitive and/or exemplary damages of $100
million. On August 31, 2011, plaintiffs filed an amended complaint based on the August 31, 2011 Murray complaint.

The Prischman Case
On March 21, 2011, the Estate of Paul Prischman filed suit in the Superior Court of the District of Columbia, Prischman et. al. v. Motorola, Inc., et. al., alleging that use of a cellular phone caused
Paul Prischman's malignant brain tumor. ("Prischman Case."). The complaint seeks compensatory damages of $25 million, consequential damages in excess of $25 million and punitive and/or exemplary damages of $100 million. On August 31, 2011, plaintiffs filed an amended complaint based on the August 31, 2011 Murray complaint.

The Bocook Case
On March 31, 2011, Bret Bocook and his wife filed suit in the Superior Court of the District of Columbia, Bocook et. al. v. Motorola, Inc., et. al., alleging that use of a cellular phone caused Bret Bocook's malignant brain tumor. ("Bocook Case."). The Bocook plaintiffs assert the same causes of action and demand the same relief as the Murray plaintiffs and also assert claims under the California Consumer Legal Remedies Act and the North Carolina Unfair and Deceptive Trade Practices Act. The case was transferred to the same judge handling the Murray cases. On September 14, 2011, plaintiffs filed an amended complaint.

The Solomon case
On October 27, 2011, Andrew and Monique Solomon filed suit in the Superior Court of the District of Columbia, Solomon v. Motorola, et al, Case No. 11CA8472B, alleging that use of a cellular phone caused his malignant brain tumor ("Solomon Case"). The complaint is based on the same legal theories and factual allegations as the Murray cases and seeks compensatory damages in excess of $50 million, consequential damages in excess of $50 million and unspecified punitive and/or exemplary damages. The Solomon case has no claims for consumer protection act violations. On December 19, 2011, the Solomon case was transferred to the same judge handling the Murray cases.

Dahlgren v. Motorola, Inc., et al.
On September 9, 2002, Dahlgren v. Motorola, Inc., et al., was filed in the D.C. Superior Court containing class claims alleging deceptive and misleading actions by defendants for failing to disclose the alleged "debate" related to the safety of wireless phones reflected in studies that allegedly show wireless phones can cause harm. On December 9, 2005, Plaintiff filed an amended complaint in Dahlgren. On March 5, 2008, the court stayed Dahlgren pending the outcome of Murray v. Motorola, Inc., et al. After the Murray decision, the Court lifted the stay and the Plaintiff amended the complaint to remove the class allegations and sue in a representative capacity on behalf of the General Public of the District of Columbia. Dahlgren seeks treble damages or statutory damages in the amount of $1,500 per violation, whichever is greater, disgorgement of profits, punitive damages, attorneys' fees, costs or disbursements. On July 8, 2010, the court granted Defendant's motion to dismiss in part and denied it in part. The court dismissed claims asserting that Defendants failed to disclose the "safety debate" regarding cellular telephones and certain claims pre-dating October 2000. The court denied Defendants' argument that federal preemption barred Plaintiff's claims in their entirety. Plaintiff filed a third amended complaint on September 21, 2010.

Yigdal Goldstein v. Partner Communications Company Limited v. Motorola Mobility Israel (2010) Ltd.
In May 2010, Yigdal Goldstein filed suit before the Central District Court in Petach Tikva in Israel against Partner Communications Company Limited, a cellular phone distributor, asserting that his use of Samsung and Motorola cellular phones caused his cancer, lymphoma. Partner filed a third party notice, the equivalent of a third party complaint, against Motorola Mobility Israel (2010) Ltd. ("Motorola Israel"), a subsidiary of Motorola Mobility, Inc., claiming that Motorola Israel was the proper defendant because it manufactured the cellular phone. Partner subsequently served Motorola Israel with the complaint and Motorola Israel answered on December 1, 2011. Plaintiff seeks damages in excess of the jurisdictional minimum of $650,000.

For the fiscal year ended December 31, 2011
MOTOROLA MOBILITY HOLDINGS, INC.
http://sec.gov/Archives/edgar/data/1495569/000119312512067566/d291113d10k.htm#rom291113_17