Enforcing US judgments: when it doesn’t pay to multiply your award (Motorola v Hytera)

Posted: 28/01/2025

Claimants (plaintiffs) in US litigation are generally delighted when they are awarded multiple damages as additional or punitive compensation for the civil wrong they have suffered. However, trying to enforce a US judgment for multiple damages in the UK can lead to disastrous consequences, as a recent High Court judgment shows.

In Motorola Solutions, Inc & Anor v Hytera Communications Corporation Ltd & Ors (Rev1) [2024] EWHC 2891 (Comm), the High Court refused to enforce part of a multi-million dollar US judgment because it fell within the definition of ‘multiple damages’ under section 5 of the Protection of Trading Interests Act 1980 (PTIA). This provision is so rarely relied upon that the court referred to it as only being subject to a ‘sprinkling’ of authority. 

This article considers the legislation, its impact on the enforcement of US judgments, and looks at the strategic options for parties to transatlantic litigation.

Enforcement of US judgments

Enforcing US judgments in the UK is not always straightforward. There is no reciprocal agreement in place for mutual recognition and enforcement (although if the US ratifies the Hague Judgments Convention, this will change). US judgments are therefore currently enforced under the common law by bringing a new claim, under which the US judgment is treated as a contractual debt. 

To enforce the debt, various elements must be satisfied, one of which is that the US court had jurisdiction over the debtor in that the debtor has (according to English law) submitted to the jurisdiction of the US court. Often (particularly if the defendant is not based in the US), this is a ground upon which enforcement can be resisted. Another ground for resisting enforcement is public policy. For example, the English courts will not enforce foreign judgments viewed as punitive or penal in nature. 

In this case, while related to that aspect of public policy, the enforcement of this judgment was resisted (partially) by the specific restriction imposed under the PTIA. For more information on enforcing US judgments generally, see here.

What is the purpose of the PTIA?

The Protection of Trading Interests legislation covers a range of issues, but at its heart, it is designed to protect ‘legitimate trade’ between UK persons and countries affected by the extraterritorial application of certain laws. While much of the legislation relates to extraterritorial US sanctions, the PTIA also takes aim against other US laws perceived as an attempt to regulate, to an ‘undue degree’, trading activity outside the US. 

In particular, it addresses the impact of US anti-trust legislation permitting (in addition to criminal sanctions) private civil actions for ‘treble damages’. In parliamentary debates on the legislation, the US government confirmed its legislation is intended to act as a deterrent to illegal activity and to provide an incentive to victims to act as ‘private Attornies General’.  

While the UK acknowledged back in 1980 that its ‘friend and ally’ had the right to ‘enforce vigorously’ its laws within its own jurisdiction, it took exception to the US attempting to enforce its economic rules outside of this. With the start of a new US administration in 2025, the future scope of US extraterritorial measures is likely to come under close scrutiny. 

How does the PTIA work?

Section 5 of the PTIA restricts the enforcement of relevant foreign judgments either at common law or under the applicable registration regime. Crucially, where a judgment is caught by section 5, it prevents recovery of ‘any sum’ payable under the judgment. 

Of particular relevance to US judgments, section 2(a) prevents enforcement of any judgment for ‘multiple damages’. This is defined (in section 3) as an amount ‘arrived at by doubling, trebling or otherwise multiplying a sum assessed as compensation for the loss or damages sustained by the person in whose favour the judgment is given.’ 

Hansard records the suggestion in debates prior to the passing of the legislation that the English courts ‘would tremble with rage at being asked to enforce a foreign judgment for triple damages’. Whether or not due to fear of the courts’ ‘rage’, there have been very few judgments on the scope of the prohibition against enforcement of multiple damages. In fact, until now, despite the plain wording of the legislation, it had not been clear precisely what kinds of awards fell within the definition of ‘multiple damages’. 

This decision has now clarified the meaning of multiple damages and the scope of the prohibition under the legislation. It also provides useful guidance on the approach the court will take to enforcing foreign judgments containing elements of both compensatory and punitive damages. The judgment clarifies the impact of any underlying unenforceability on claims to enforce awards for interest and legal costs.

Motorola v Hytera – the background

In 2020, Motorola obtained judgment in the US against Hytera in connection with breaches of US intellectual property and trade secret misappropriation law. The judgment was made up of different elements including: compensatory damages under the Copyright Act and the Defend Trade Secrets Act (DTSA); punitive damages under the DTSA; both pre and post-judgment interest (on a global basis); and legal costs (in connection with the totality of the proceedings). In these proceedings Motorola only sought enforcement of the interest and legal costs, having previously obtained judgment by consent in relation to the compensatory damages award under the Copyright Act.

Although in its skeleton argument, Motorola appeared to concede that the DTSA judgment for punitive damages fell within the meaning of multiple damages under section 5 of the PTIA, during the course of the hearing in oral argument, counsel for Motorola contended in fact that it did not fall foul of section 5, and was not a judgment for multiple damages.

Motorola also argued that in the event the DTSA judgment was deemed unenforceable, the interest and legal costs could be deemed payable in connection with the ‘non-objectionable’ Copyright Act judgment.

What did the court decide? 

The court held that the DTSA judgment was a judgment for multiple damages within the meaning of section 5 of the PTIA. It was irrelevant that the Illinois court had not been obliged to multiply the award; the relevant issue was that it had been multiplied.

It was not possible to sever the compensatory element from the punitive element because they both related to the same cause of action. SAS Institute Inc v World Programming Ltd [2018] EWHC 3452 (Comm) was correctly decided.

The PTIA precludes recovery of ‘any sum payable’ under an award for multiple damages. The underlying US judgment provided for interest and costs on a global basis. It was not possible for the English court to reinvestigate the awards for interest and speculate on how they might be apportioned. The PTIA therefore precluded recovery of any interest or legal costs in connection with the judgment.

What are the practical points for transatlantic enforcement? 

A number of key considerations arise when enforcing foreign judgments which may have an element of ‘multiple damages’. Ideally (if enforcement in the UK is anticipated), it is important to consider in advance the best way to structure any potential damages award. Optimising the underlying judgment for future enforcement may involve additional time and expense, but as this judgment shows, it could make a vital difference to enforcement prospects. In particular, it is worth thinking about the following key points:

• Does the foreign judgment fall within the definition of ‘multiple damages’? Where the foreign statute mandates multiplying an award, this clearly falls within the prohibition. Where (as in this case) the foreign court chooses (but is not obliged) to multiply damages as a punitive award, it is likely that the award will also fall foul of the PTIA.
• However, while the court did not expressly decide the issue in this case, where the foreign court does not ‘multiply’ damages but instead imposes an additional (though punitive) sum on top of a damages award, this is ‘less likely’ to fall foul of the PTIA prohibition. It may still be unenforceable under the general public policy ground as referred to earlier in this article.
• If the award for a single cause of action contains both a compensatory element and a punitive element, the latter having been arrived at by multiplying the former, the entire award is unenforceable. It is not possible to sever the two elements. The practical impact of this is that it may be appropriate, if contemplating enforcement in the UK, to forego seeking punitive as well as compensatory damages for the same cause of action.
• If, however, there are separate awards for separate causes of action, one of which has no element of punitive damages arrived at by multiplication, severance of the awards may be possible, with only the multiplied award rendered unenforceable.
• If the underlying award falls within the definition of section 5 of the PTIA, then it prevents recovery of interests and costs related to the award. It is not possible to sever the compensatory and punitive elements of an award for a single cause of action. This means that it is also not possible to sever awards for interest and costs. Section 5 of the PTIA precludes recovery of ‘any sum payable’ under the relevant award. If a foreign judgment contains awards for separate causes of action, some of which are purely compensatory, it may therefore be beneficial to try to apportion interest and costs to the purely compensatory award separately. This may provide grounds for arguing that those interest and costs awards are not captured by the prohibition on enforcement under section 5 of the PTIA.

Conclusion

Enforcing US judgments in the UK is not a straightforward process. Where enforcement over assets or defendants in the UK is anticipated, US lawyers need to consult with specialist UK lawyers at an early stage. It is crucial to understand the reasons why there may be difficulties in enforcing certain kinds of judgments. Structuring the judgment appropriately for overseas enforcement can be a crucial step, and the best international asset recovery strategies involve a coordinated approach from the outset. 

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