Cloud SIM technologies and service providers, Hongkong uCloudlink Network Technology Limited and Ucloudlink (America), Ltd. (collectively, “uCloudlink”), were sued by SIMO Holding Inc. (“SIMO”) in June 2018 in the U.S. District Court for the Southern District of New York（“SDNY”）for patent infringement. SIMO initially asserted that uCloudlink’s G2, G3, U2 and S1 products infringed U.S. Patent No. 8,116,735 and added U.S. Patent No. 9,736,689 in August 2018.

uCloudlink filed a patent infringement lawsuit against Skyroam and SIMO in the U.S. District Court for the Northern District of California（“NDCA”）in August 2018, claiming that Skyroam and SIMO infringed uCloudlink’s U.S. Patent Nos. 9,432,066 and 9,548,780.

Progress of the Cases:

1.  In January 2019, SIMO dismissed the ’735 patent with prejudice and reduced the asserted claims relating to the ’689 patent to claims 8 and 11-14.

2.  On April 15, 2019, the district court judge in SDNY issued a summary judgement order finding holding that uCloudlink’s products infringed claim 8 and claim 11 of the ’689 patent, but found no pre-suit damages before August 2018. On May 9, 2019, after two days of deliberation, the jury in SDNY found at least one of the asserted patent claims was valid, awarded damages of USD 2,183,562 against uCloudlink, and found willful infringement.

3.  uCloudlink has filed an inter partes review (“IPR”) petition in the U.S. Patent Office to invalidate all claims of the ’689 patent, and the procedure is still ongoing. If the ’689 patent is invalidated by the Patent Office, there would be no infringement by uCloudlink.

4.  uCloudlink’s patent infringement case against Skyroam and SIMO in NDCA is in the discovery stage.

UCloudlink’s View：

1.  uCloudlink is very surprised and disappointed with the district court’s infringement judgement and the jury’s verdict. uCloudlink strongly believes the accused products did not infringe the asserted claims of the ’689 patent.

2.  The district court’s rulings do not end the case. uCloudlink will appeal the district court’s rulings to the United States Court of Appeals for the Federal Circuit (“Federal Circuit”), and believes the Federal Circuit will render a right judgement.

Impact on the Users：

1.  uCloudlink advises the users that the district court’s rulings only apply to the business in U.S. which related to the accused products, it has no impact on uCloudlink’s business in other regions, and no impact on uCloudlink’s business involving the products powered by new technologies (including in the United States).

2.  uCloudlink has taken proactive technical measures to reduce the impact of the district court’s rulings on uCloudlink’s U.S. business. uCloudlink’s service does not solely rely on one technology, and uCloudlink has implemented software upgrade to avoid unnecessary dispute. Accordingly, uCloudlink believes that the use of uCloudlink’s products and services by worldwide users (including users in the United States) will not be adversely affected by the district court’s rulings.

3.  uCloudlink will continue to pursue its legal action in NDCA to enforce its patent rights against Skyroam and SIMO’s infringing products in order to protect the legitimate interests of uCloudlink.

Hongkong uCloudlink Network Technology Limited

Ucloudlink (America), Ltd.

May 14, 2019