REGULATORY UPDATES

2/3/14: “Connected-vehicle technology could cut crashes while paving way for driverless cars”
The U.S. Transportation Department announced it will move forward with researching “Connected Vehicle Technology.” According to Transportation Secretary Anthony Foxx, connecting all of the country’s vehicles could reduce non-alcohol-related traffic accidents by nearly 80%, preventing 5.1 million accidents per year, and saving 18,000 lives. NHTSA is conducting a pilot program with 3,000 connected cars in Ann Arbor, Michigan in an effort to test the reliability of the technology.
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LITIGATION UPDATES

2/25/14: American Vehicular Sciences, LLC v. TomTom, Inc.
Plaintiff American Vehicular Sciences, LLC (“AVS”) brings suit against TomTom, Inc. (“TTI”) and Mazda Motor of America, Inc. (“Mazda”) for allegedly infringing upon AVS’ patented technology for “Vehicle speed control method and arrangement.” AVS alleges both TTI and Mazda sold portable navigation systems and in-dash navigation systems which infringe upon AVS’ abovementioned patent. Among the vehicles sold with the alleged infringing technology are 2013 and 2014 CX-5, CX-9, Mazda3, and Mazda6 models.
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2/21/14: Innovative Display Technologies, LLC v. BMW of North America, LLC
Plaintiff Innovative Display Technologies, LLC (“IDT”) brings suit against Defendant BMW of North America, LLC (“BMW”) for allegedly infringing upon IDT’s patents. BMW allegedly sold vehicles having navigation or driver information displays and tail lights which were protected by patents held by IDT. The vehicles purportedly containing the infringing technology, described as a “Light Emitting Panel Assemblies,” are the 3-, 5-, and 6-series models, and M3 sedans.
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2/20/14: “Ford sued over use of company’s hybrid vehicle inventions”
Paice LLC filed suit against Ford, alleging Ford developed hybrid vehicles using its patented technologies. Paice says Ford’s C-Max, Fusion, and Lincoln MKZ infringe on its patents covering ways to control electric motors and gas engines for increased fuel efficiency and reduced emissions without reduced performance. Ford licensed one of Paice’s patents in 2010, and the companies agreed not to litigate until 1/1/14 to allow time to reach a broader settlement. However, Paice cried foul at the allegedly “short and one-side” negotiation. Paice LLC won a patent-infringement case against Toyota Motor Corp. in 2010, and has pending patent infringement complaints against Hyundai Motor Co. and Kia Motors Corp. over the same patents.
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2/19/14: Copans Motors, Inc. v. Porsche Cars North America, Inc.
Plaintiff Copans Motors, Inc. dba Champion Porsche (“Champion”) brings suit against Porsche Cars North America, Inc (“Porsche”) seeking judgment that Porsche’s attempt to terminate the Champion franchise agreement is unfair and fails to satisfy statutory requirements.
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2/19/14: “Lawsuit: GM knew of Cobalt ignition problem”
In a civil suit against GM, depositions reveal the automaker knew in 2004 its Cobalt model had an ignition switch which could inadvertently shut off the engine while driving, cutting the driver’s power steering and brakes, and disabling the vehicle’s airbags and anti-lock brakes. Additionally, according to documents obtained by USA TODAY from a previous lawsuit over a vehicle crash which killed 29 year old Brooke Melton in 2010, it was found that at least one GM engineer encountered the ignition switch problem while testing a new model-year 2005 vehicle. In a recall for older-model Cobalts and similarly affected Pontiac G5s, GM said it knows of at least six deaths in five Cobalt crashes where airbags failed to deploy due to an ignition switch failure. GM will replace the switch in 778,619 vehicles (2005-2007 Chevrolet Cobalt and 2007 Pontiac G5).
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2/11/14: Clear With Computers, LLC v. Tesla Motors, Inc.
Plaintiff Clear With Computers, LLC (“Clear”) brings suit against Defendant Tesla Motors, Inc. (“Tesla”) for allegedly infringing upon Plaintiff’s patented works by using computer sales methods, sale systems, and marketing systems covered by Clear’s “Electronic proposal preparation system for selling computer equipment and copy machines,” and “Electronic proposal preparation system” patents.
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2/11/14: Clear With Computers, LLC v. Volvo Construction Equipment North America, LLC
Plaintiff Clear With Computers, LLC (“Clear”) brings suit against Defendant Volvo Construction Equipment North America, LLC (“Volvo”) for allegedly infringing upon Plaintiff’s patented “Electronic proposal preparation system for selling computer equipment and copy machines.”
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2/7/14: “Toyota close to $1 billion deal to settle U.S. probe: WSJ”
Toyota Motor Corp. is close to settling its unintended acceleration probe for $1 billion, though numbers and figures are still subject to change before the deal is struck. Toyota faces 200 proposed class actions and 500 individual lawsuits involving unintended acceleration claims. A Toyota spokeswoman said, “Toyota continues to cooperate with the U.S. attorney’s office in this matter, and in the nearly four years since this inquiry began, we’ve made fundamental changes to become more responsive and customer focused, and we’re committed to continue to improve.” The automaker maintains the electronic throttle system was not at fault, blaming the claims on ill-fitting floor mats and sticky gas pedals.
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INDUSTRY INTERESTS

2/25/14: “Tesla tops $30 billion as Morgan Stanley boosts outlook”
Tesla Motors Inc. passed $30 billion in market valuation after Morgan Stanley doubled its projected stock price. Shares increased 14% to $248 through the end of the trading day, with a 12-month price target pegging the stock at $320. Morgan Stanley analyst Adam Jonas said, “If it can be a leader in commercializing battery packs, investors may never look at Tesla the same way again . . . If Tesla can become the world’s low-cost producer in energy storage, we see significant optionality for Tesla to disrupt adjacent industries.” CEO Elon Musk announced this week plans for a proposed ‘gigafactory’ to produce lithium-ion batteries.
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2/25/14: “VW Tennessee workers challenging UAW objection to plant vote”
Five VW workers are challenging an objection filed by the UAW with the federal government after the UAW’s defeated unionization vote at the Chattanooga, Tennessee VW plant. From the petition: “The employee-intervenors must be permitted to intervene because their employer and the UAW are colluding to force unionization onto them and their co-workers.” The United Auto Workers’ objection claims “outside interference” led by politicians such as Republican U.S. Senator Bob Corker skewed worker-voters.
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2/25/14: “Honda creates new Acura planning arm to lead brand overhaul”
Honda announced the creation of a new group to plan business development for the Acura premium brand, following a 10% drop in U.S. Acura sedan sales in 2013. President of Honda R&D Americas, Erik Berkman, will assume the position of division manager of the new Acura Business Planning Office.
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2/24/14: “Hyundai Motor reinstates former R&D president”
Hyundai announced it will reinstate former research and development president Kwon Moon-Sik, who quit the job just three months previously over quality problems. Hyundai also said former exterior designer chief Lee Byun-Seob is appointed to head of the automaker’s design center after Oh Suk-Geun resigned for “personal reasons” this month.
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2/24/14: “Fisker and new Chinese owner to restart Karma production this year”
Pin Ni, head of Wanxiang Group’s U.S. wing which acquired Fisker’s assets for $149.2 million in a bankruptcy auction last year, said Fisker will restart production of the Karma as early as this year at its Finland plant. Ni said the business plans for Fisker are still finalizing, and there is no forecast for the number of Karmas it plans to sell. Fisker sold 1,800 Karmas through 2012 when it ceased production, falling short of its 11,000 vehicle goal.
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2/19/14: “Dongfeng rescues Peugeot with $1 billion”
Chinese state-owned Dongfeng Motor signed an agreement to purchase an 800 million euro ($1.1 billion) stake in Peugeot. The French government will also acquire an equal stake in Peugeot on identical terms; all three stakeholders will have two board seats as part of the deal. The partnership hopes to sell 1.5 million units starting in 2020 under the Dongfeng, Peugeot, and Citroen brands. Peugeot closed on a net loss of 2.32 billion euros ($3.2 billion) last year, and a net loss of 5 billion ($6.9 billion) in 2012. Peugeot shares, however, have risen 37% this year on expectations of a deal with Dongfeng.
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2/11/14: “GM says CEO Barra’s pay may total $14.4 million this year”
Newly appointed GM CEO, Mary Barra, may receive a total compensation of $14.4 million this year -- $10 million more than previously disclosed. Pending approval by shareholders at GM’s annual meeting in June, Barra may receive $10 million in long-term compensation as part of her package, $1.6 million in salary, and $2.8 million as part of the company’s short term incentive plan. By comparison, Dan Akerson who stepped down to take care of his ailing wife, earned $11.1 million in 2012, though he still remains at GM as a senior adviser and is eligible to receive a pay package up to $4.68 million this year.
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2/6/14: “Kia Motors’ sole Korea-based female executive leaves firm”
Claire Chai, Kia’s only Korea-based female executive, has left the automaker to return to the cosmetics industry to serve as marketing chief to Amorepacific. Female employees for Hyundai Motor and affiliate Kia account for less than 5% of their domestic workforce. Kia has one other female executive, Maria Soklis, who is Chief Operating Officer of its Canadian unit.
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RECALLS

2/25/14: “GM Expands Ignition Switch Recall by More Than 588,000 Vehicles”
GM adds 2003-2007 Saturn Ion compacts, and 2006-2007 Chevrolet HHR SUVs, Pontiac Solstice, and Saturn Sky sports cars to its recall to fix ignition switches that can unintentionally shut off engines, causing a crash.
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2/24/14: “24,000 Yahama Motorcycles From 2009-2013, Including YZFR1 and XTS12 Models”
Yamaha recalled 2009-2013 YZFR1 motorcycles manufactured October 2008 through August 2013 and 2012-2013 XTZ12 motorcycles manufactured October 2011 through August 2013 for headlight bulb sockets that may overheat or melt, causing headlight failure.
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2/24/14: “13,535 Nissan Frontier Vehicles From 2012-2014”
Nissan recalled 2012-2014 Frontier vehicles manufactured from 11/28/12 through 12/17/13 for potential electrical short which may cause a fire.
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2/18/14: “11,961 Kia Sportage Vehicles From 2014”
Kia Motors recalled 2014 Kia Sportage vehicles manufactured 9/ 30/13 through 1/11/14 for incorrect labels regarding tire pressure, which could result in tire damage.
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2/14/14: “700,000 Toyota Prius Vehicles From 2010-2014”
Toyota recalled 2010-2014 Prius vehicles for transistors that may become damaged from high-operating temperatures, which could shut the vehicle down while in operation.
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2/14/14: “619,122 Chevrolet Cobalt and Pontiac G5 Vehicles from 2005-2007”
GM recalled 2005-2007 Chevrolet Cobalt, and 2007 Pontiac G5 vehicles for ignition switches that may move out of the run position, causing engines and air bags to turn off.
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2/14/14: “261,114 Toyota Vehicles From 2012-2013, Including Tacoma and Lexus Rx350 Models”
Toyota recalled 2012-2013 Toyota Tacoma and Lexus RX350 vehicles and 2012 Toyota Rav4 vehicles for various systems that may become inoperative, including Antilock Brake System and Vehicle Stability Control, increasing the risk of a crash.
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2/4/14: “5,001 Aston Martin Vehicles From 2008-2014, Including Rapide and Vantage Models”
Aston Martin recalled 2008-2014 DB9 and V8 Vantage, 2009-2012 DBS, 2010-2012 Rapide, 2014 Rapide S, 2011-2012 V12 Vantage, 2011-2014 V8 Vantage S and 2012 Virage vehicles for a manufacturing error that may cause the accelerator pedal arm to break.
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