After six long years, the astonishing "largest case of new energy vehicle technology secrets" with a whopping price tag of 2.1 billion yuan has finally come to a conclusion.

This major case between Geely and WM Motor ended with Li Shufu's resounding victory and Shen Hui's crushing defeat. Why did these two former bosses and executives, once a "golden partnership," end up in court?

1. The biggest case in the industry finally comes to a conclusion

Recently, the Intellectual Property Tribunal of the Supreme People's Court issued a document stating that the trial has concluded the infringement dispute case between Geely and WM Motor regarding the technical secrets of new energy vehicle chassis technology caused by a large number of employee "job hopping".

It is reported that the plaintiff Geely claimed compensation of up to 2.1 billion yuan.

After hearing, the Supreme People's Court applied a 2-fold punitive compensation judgment in the second instance, and the infringer WM Motor was ordered to compensate for economic losses and reasonable expenses for rights protection totaling approximately 640 million yuan.

This means that Geely has achieved a complete victory in defending its intellectual property rights, while WM Motor has paid a heavy price for its illegal infringement.

This case has three major highlights:

First, the case involves industry giants Geely and the emerging automotive force WM Motor, with a huge stake and far-reaching impact. The Intellectual Property Tribunal of the Supreme People's Court characterized it as "the largest case of new energy vehicle technology secrets".

Second, the case took a long time, spanning six years, with considerable difficulty in evidence collection and trial.

Third, the compensation amount of 640 million yuan set a new high in the amount of compensation awarded in intellectual property infringement lawsuits in China, serving as a significant warning to the automotive industry and potentially effectively deterring the occurrence of infringement in the automotive industry.

2. The grudges between Li Shufu and Shen Hui

In fact, the two protagonists involved in this case, Geely boss Li Shufu and WM Motor boss Shen Hui, once had a close and beautiful time together.

A decade ago, during Li Shufu's momentous battle to acquire Volvo - the largest overseas merger and acquisition case in the history of China's automotive industry - Shen Hui played an important role.

This industry giant, who had served as a senior executive at global giants such as BorgWarner and Fiat, joined Geely Holding Group as a director and vice president at Li Shufu's invitation.

He assisted Li Shufu in completing the acquisition of Volvo and was responsible for Volvo's landing in the Chinese market, earning him the title of Geely's great contributor.

Later, Shen Hui left Geely and founded WM Motor, entering the new energy vehicle race. At that time, Shen Hui took away a large number of core forces from Geely, especially talents in R&D, technology, and quality control.

People come and go in the industry, which is understandable.

However, Geely discovered that Shen Hui and these former Geely team members used the new energy chassis technology and drawings they had access to and mastered at Geely to apply for a large number of patents. Furthermore, WM Motor, without any technological accumulation or legitimate technological sources, launched the WM EX series models in a short period of time, seriously infringing on Geely's legitimate rights and interests.

Such insider behavior by Shen Hui and others is indeed despicable. Unable to bear it any longer, Geely sued WM Motor in court.

3. Geely may find it difficult to obtain 640 million yuan

In the past, many similar infringement cases have occurred in the automotive industry. Due to various reasons, most of these cases ended inconclusively due to difficulties in evidence collection and rights protection.

Regarding the case with WM Motor, Geely officials also told the media: "It was extremely difficult, and the difficulty of evidence collection behind the scenes was beyond imagination."

According to the information in the judgment document, Geely spent over 13 million yuan to win this lawsuit.

Over six years, spending over 13 million yuan, as well as a significant amount of manpower and material resources, Geely's journey to defend its rights has indeed been difficult.

Fortunately, Geely won the lawsuit, defended its legitimate rights and interests, and received 640 million yuan in compensation. However, it is worth noting that Geely may find it difficult to obtain these 640 million yuan.

Due to multiple reasons such as low product competitiveness, multiple failed listings, and a broken capital chain, WM Motor declared bankruptcy reorganization last October. It is reported that Shen Hui has also fled overseas and not returned.

The audit report shows that WM Motor has long been insolvent, with total assets of 3.988 billion yuan and liabilities of up to 20.367 billion yuan. Under such circumstances, the possibility of Geely obtaining a high compensation of 640 million yuan is very small.

However, even if Geely knew this in advance, it still chose to pursue this lawsuit. By making this technology piracy case into an ironclad case, Geely's core purpose was not for compensation but to fight for its reputation and deter potential infringers. As a veteran carmaker, Li Shufu's main goal was to punish insiders and create a good environment for Geely's long-term development.

Li Shufu recently stated at the 2024 China Automotive Chongqing Forum that China does not lack automakers today, but what it lacks is an innovative ecological environment and original technology companies.

Over the years, Geely has adhered to independent innovation and technology-driven development, investing over 200 billion yuan in R&D over the past decade. As of the end of 2023, Geely Group has accumulatively obtained over 24,000 valid patents.

We hope to have more companies like Geely and fewer companies like WM Motor.