Court cases, regulatory measures and recalls involving Midea

analysisMidea Group's 2025 annual report states that in 2025 the company had no material litigation or arbitration, no penalties or rectification matters and no bankruptcy or reorganisation matters, and its 2026 interim report makes the same three statements for the first half of 2026. These are the company's own disclosures under the materiality thresholds of the report format and do not exclude non-material proceedings, such as the U.S. lawsuits and the investigation set out below. In its July 2026 plan for an issue of A shares to its controlling shareholder Midea Group, Shenzhen CLOU Electronics, a Midea Group subsidiary, stated that as of the announcement date Midea Group and its directors and senior managers had not received administrative penalties (other than those clearly unrelated to the securities market) or criminal penalties in the previous five years and were not involved in unfinished material civil litigation or arbitration relating to economic disputes. That statement is made by a subsidiary about the subscriber of its share issue and by its own terms covers only about five years and the stated categories. ^{1 2 3}

analysisSeparately, media reports describe administrative fines on two Midea financial subsidiaries. According to a report of 14 April 2022, the Foshan Central Sub-branch of the State Administration of Foreign Exchange ordered Midea Group Finance to rectify, warned it and fined it RMB 50,000 for failing to submit statistical reports and other materials as required; the same report, citing a commercial company-data service, said the Foshan office of the former China Banking Regulatory Commission had fined the company RMB 200,000 in June 2017 for bill-discounting business without a genuine trade background. According to a report of October 2025, the People's Bank of China Shenzhen Branch on 26 September 2025 warned Shenzhen Midea Payment Technology and fined it RMB 2.81 million for breaching account-management and clearing-management rules. In each case the penalty publication or decision itself was not retrieved. ^{4 5}

analysisIn February 2019 Fang Hongbo, whom the September 2024 prospectus describes as chairman of the board and chief executive officer, received a warning letter from the Guangdong Regulatory Bureau of the China Securities Regulatory Commission (CSRC) over an incident in which he inadvertently mentioned the company's estimated profit before tax for 2018 at a forum before the official announcement of the 2018 profit estimate, according to Midea's H-share listing document of 9 September 2024. The letter itself is not in the record; its content is known only from the company's summary, and it is a supervisory warning, not an administrative penalty. The listing document records the advice of the company's PRC legal adviser that the letter is a non-punitive regulatory measure of the CSRC that does not constitute an administrative penalty or public censure under PRC laws, regulations or rules, and the directors' view that, because the incident preceded the track record period and Fang Hongbo has not experienced any similar incident since, it does not impugn his integrity or suitability to serve as a director. ¹

analysisThe CSRC Sichuan Regulatory Bureau's administrative penalty decision [2021] No. 19 of 7 October 2021 sets out how inside information arose around Midea Group's 2020 acquisition of control of Hiconics. According to the decision, Midea Group representatives met Hiconics' side at its office in Jiashan, Zhejiang, on 3 January 2020; at an internal Midea Group meeting on 13 January 2020 the chairman agreed to pursue the acquisition; Midea Group's executive committee approved the plan on 23 March 2020; and on 25 March 2020 Guangdong Midea HVAC Equipment Co., Ltd. agreed to buy 208,685,418 Hiconics shares (about 18.73%) from Hiconics' former controlling shareholder and another shareholder and received an irrevocable proxy over a further 5% of the voting rights for 15 months from completion, giving it control of 23.73% of the voting rights. The decision treats the planned change of control as inside information from 13 January to 25 March 2020; Midea Group and Hiconics announced it after the market closed on 25 March 2020. The decision describes the transaction only to fix that period for a penalty on an individual and makes no finding against Midea Group, Midea HVAC or Hiconics. ²

analysisIn the same decision the bureau fined an individual RMB 800,000 for insider dealing in Hiconics shares. It describes the individual as the spouse of a then vice-president of Midea Group, whose name it gives only in partly masked form, who took part in the executive committee vote of 23 March 2020 and is treated as an insider from that date at the latest. After three telephone contacts between the two on 25 March 2020, the individual began buying Hiconics shares that afternoon through a securities account in a relative's name under the individual's control, bought 150,000 shares for RMB 503,000 and sold them on 2 and 3 June 2020 at a profit of RMB 105,722.2; the bureau found breaches of Articles 50 and 53(1) of the Securities Law constituting insider dealing under Article 191. The decision is addressed to the individual alone and imposes no measure on the vice-president, Midea Group or Hiconics; the individual is a private person and is not named here. The decision records that the individual did not ask to make a statement or defence or to be heard, and that administrative review could be sought from the CSRC within 60 days and court proceedings brought within six months, with the penalty not suspended during review or litigation; no review or court challenge appears in the record. ²

analysisA media report of 19 November 2021 stated that the same bureau had also penalised a long-time friend of Hiconics' then chairman for insider dealing in Hiconics shares ahead of the announcement of Midea's acquisition, confiscating illegal gains of RMB 1.7367 million and imposing a fine of RMB 5.2101 million (RMB 6.9468 million in total) on 3 November 2021. According to the report, the chairman mentioned the planned sale to Midea during a card game with the friend on 22 March 2020, and a family member of the friend began buying Hiconics shares on 23 March 2020 on the friend's instructions. The bureau's decision on this second penalty is not in the record and the details come from the media report only; the penalised person is a private individual with no role at Midea Group, and the report describes no measure against Midea Group or its staff in this matter. ³

analysisA U.S. International Trade Commission (ITC) notice published in the Federal Register on 21 November 2025 states that the Commission had received a complaint filed on behalf of Whirlpool Corporation on 18 November 2025 alleging violations of section 337 of the Tariff Act of 1930 in the importation into and sale within the United States of certain low-profile microwave-hood combination products (docket number 3857). The complaint names as respondents several appliance makers and their U.S. units, including Midea Group Co., Ltd. and Midea America Corporation of Parsippany, New Jersey, and requests a limited exclusion order, cease and desist orders and a bond during the presidential review period. A complaint contains allegations; the notice is not a finding of infringement or of any violation. ¹

analysisOn 22 December 2025 the ITC instituted investigation No. 337-TA-1467 on the complaint, as supplemented, alleging infringement of certain claims of five U.S. patents and the existence of a domestic industry, against 16 respondents including Midea Group Co., Ltd. of Foshan and Midea America Corporation; institution is not a finding on the merits. The Commission terminated the investigation as to Meyer Corporation, U.S. and Electrolux Professional AB on 18 February 2026 and as to Haier Group Corporation on 20 February 2026, each on withdrawal of the complaint, the Haier motion stating that all remaining respondents did not oppose it. On 16 March 2026 it terminated the investigation as to numerous asserted claims of all five patents. Whirlpool moved on 4 June 2026 to withdraw three further claims, unopposed by the remaining respondents; the administrative law judge granted the motion on 9 June 2026 (Order No. 27) and on 26 June 2026 the Commission decided not to review that determination. Withdrawing claims narrows the case and decides nothing on the remaining ones. The notice of 26 June 2026, the latest ITC record retained, shows no termination as to Midea Group or Midea America and no determination on the merits. ^{2 3}

analysisOn the same day as its ITC complaint, 18 November 2025, Whirlpool sued Midea Group Co., Ltd. and Midea America Corp. for patent infringement (35 U.S.C. § 271) in the U.S. District Court for the District of New Jersey (case 2:25-cv-17663), with a jury demand, according to a court docket copy. On 6 January 2026 the two defendants filed a joint stipulation and proposed order to stay the case under 28 U.S.C. 1659, and on 8 January 2026 Judge Madeline Cox Arleo signed the order staying it. The complaint's contents are not in the record; the docket copy shows procedural events only and was last retrieved on 8 January 2026. ⁴

analysisHaier US Appliance Solutions, Inc., doing business as GE Appliances, sued Midea America Corp. in the U.S. District Court for the District of New Jersey on 24 April 2025 (case 2:25-cv-03189) under the Defend Trade Secrets Act (18 U.S.C. § 1836(b)), with a jury demand, and applied the same day for an order to show cause with temporary restraints. Judge Madeline Cox Arleo denied that application on 1 May 2025. Midea America moved to dismiss the complaint on 21 May 2025; the plaintiff opposed on 2 July 2025 and Midea America replied on 1 August 2025, and the docket copy does not contain the content of these filings. On 22 May 2025 the magistrate judge denied both the plaintiff's request for expedited discovery and Midea America's request to stay discovery pending the motion, ordered discovery to begin and encouraged settlement discussions. Later entries concern discovery disputes; the last entry in the docket copy, of 17 October 2025, cancels a hearing and states that an order on the disputes will follow. No ruling on the motion to dismiss appears, and the complaint's allegations are not in the record. ¹

analysisIn Kansas, two individual plaintiffs, who are not named here, allege that a malfunctioning dehumidifier caused extensive damage to their personal property and claim negligence, breach of contract, strict liability and violation of the Kansas Consumer Protection Act. Midea America Corp. removed the case from the Lyon County District Court to the U.S. District Court for the District of Kansas on 25 April 2023 (case 23-4031-DDC-GEB). In March 2024 District Judge Crabtree granted a Rule 12(b)(6) motion, described as one for lack of jurisdiction, dismissing one party, a subsidiary company, for failure to state a claim; he denied remand to state court and refused limited jurisdictional discovery as to the subsidiary, finding the plaintiffs 'merely asking for the opportunity to look for some facts that might controvert Midea America's facts'. That ruling is known only from a later order, which does not name the dismissed subsidiary; its quotation refers to Midea America's facts, and Midea America is not among the remaining defendants, GD Midea Air-Conditioning Equipment Co., Ltd. (named as Guangdong Midea Air-Conditioning Equipment Co. Ltd.) and Midea Group Co., Ltd. After the plaintiffs' amended complaint of 5 November 2024 those two defendants moved again to dismiss and the plaintiffs renewed their remand motion. According to the order of 28 January 2025, GD Midea Air-Conditioning Equipment gave sworn facts that it had no contacts with Kansas and that its control of the product ended in Asia when it sold it to Electrolux, and Midea Group gave an affidavit that it did not make or sell any dehumidifier and had no contact with Kansas; Magistrate Judge Gwynne E. Birzer denied jurisdictional discovery, finding no pleaded jurisdictional facts and no controverted facts on personal jurisdiction. The order's background, taken from the notice of removal and petition, is not a judicial finding; the ruling on the second motion to dismiss is not in the record. ²

analysisIn the U.S. District Court for the Southern District of New York, an individual plaintiff sued Midea America Corp. on 9 June 2025 (case 7:25-cv-04850, Judge Kenneth M. Karas), with the nature of suit recorded as 'Other Fraud', diversity fraud under 28 U.S.C. § 1332 as cause of action and a jury demand. Related actions by other individual plaintiffs were filed in the District of New Jersey on 13 June 2025 and in the Southern District of New York on 27 June 2025 (case 25-cv-05388). On Midea America's letter motion of 27 August 2025, the court on 30 October 2025 consolidated case 25-cv-05388 with case 25-cv-04850 as lead case, and on 2 December 2025 three individual plaintiffs filed an amended complaint with a jury demand. Under an August 2025 stipulation Midea America's time to respond runs until 30 days after a consolidated amended complaint is filed. The complaints' content is not in the record and the docket records only the nature of suit and procedural events; the plaintiffs are private individuals and are not named here, and no ruling on the merits appears in the docket copy, last retrieved on 15 December 2025. ³

analysisThe U.S. Consumer Product Safety Commission (CPSC) recall notice 25-320 of 5 June 2025 states that Midea is recalling about 1.7 million U and U+ window air conditioners in the United States, with about 45,900 more sold in Canada, because accumulated water may not drain quickly enough, which can lead to mould growth, and mould exposure presents risks of respiratory problems or other infections for some consumers. The company was aware of at least 152 reports of mould in the units, including 17 reports of consumers with symptoms such as respiratory infections, allergic reactions, coughing, sneezing or sore throat. The units, made in China and Thailand, were sold from March 2020 to May 2025 for between $280 and $500 under brands including Midea, Comfort Aire, Danby, Frigidaire, Insignia, Keystone, LBG Products, Mr. Cool, Perfect Aire and Sea Breeze, and consumers are offered a free repair or a full or prorated refund. The notice names the recalling firm only as 'Midea', GD Midea Air-Conditioning Equipment Co. Ltd. of China as manufacturer and Midea America Corp. of Parsippany, New Jersey, as importer. A recall is a corrective action, not a finding of liability; the retained copy is the CPSC's Spanish-language page, which the CPSC says is machine-translated, with the English version prevailing. ¹

analysisMidea Group's 2025 annual report and 2025 annual results announcement state that at 31 December 2025 the maximum potential loss in tax disputes involving a Brazilian subsidiary in which the company holds 51% was about BRL 547 million (about RMB 699 million), including principal, penalties and interest, and that some cases had been running for more than ten years. Under an agreement made before the acquisition, the subsidiary's original shareholders committed to compensate the company according to the verdicts, with a remaining maximum of about BRL 131 million (about RMB 168 million) at that date. The unaudited 2026 interim report gives a maximum potential loss at 30 June 2026 of about BRL 559 million (about RMB 735 million) and a remaining commitment of about BRL 131 million (about RMB 173 million). Neither filing names the subsidiary, and the amounts are management's estimates of maximum potential loss, not amounts assessed by a court. Both filings state that the cases were still pending and that management, after consulting external or independent third-party lawyers, considered the probability of losing low and made a provision based on its best estimate. ^{1 2 3}

analysisThe disputes go back more than a decade. The summary of the March 2013 report on Midea Group's share-swap absorption of Guangdong Midea Electric states that a Brazilian subsidiary 51% owned by Guangdong Midea Electric faced tax disputes of about BRL 670 million including principal and interest, about RMB 2.095 billion at the exchange rate of 28 March 2013 (3.1272), some lasting more than ten years, and that the original shareholders had agreed to compensate Guangdong Midea Electric according to the outcome up to about BRL 220 million (about RMB 688 million); it said the cases were pending, that Brazilian lawyers judged the company likely to win most of them, and that losses could require some compensation. Midea Group's 2020 annual report gave about BRL 670 million (about RMB 841 million) at 31 December 2020, with compensation of up to about BRL 157 million (about RMB 197 million), and stated that management, with reference to third-party attorneys' judgement, considered the probability of losing small and expected no significant risk of tax violation. Neither report names the subsidiary, and no retained source ties these disputes to a specific Brazilian court case. A Brazilian media report of June 2026 stated that Brazil's Superior Court of Justice, without examining the merits, had left in place a regional appellate ruling upholding an IPI tax assessment against Springer Carrier, which Midea lists as a Brazilian subsidiary, for 2004 to 2008. The record does not show whether that case is among the disputes in Midea's filings; the judgment text and the amount in dispute are not in the record, and Midea Carrier said it would await the published judgment before assessing further procedural measures. ^{4 5 6 1}

analysisA media report of 7 June 2022, citing court judgments, described two bribery convictions of Midea Group employees; Midea Group was not an accused in either case, and in the first it was the injured party. According to the report, an engineer of Midea Group accepted bribes totalling RMB 1.9 million from 2013 to 2018 from people involved in Midea Group construction and building-inspection projects he managed, and the Shunde District People's Court in Foshan convicted him of accepting bribes as a non-state functionary, imposing three years' imprisonment suspended for four years and a fine of RMB 100,000; the RMB 1.9 million his family returned to the court was confiscated, and on 2 August 2021 his family paid Midea Group RMB 1 million in compensation and obtained the company's forgiveness. A person connected with Midea Group told the publication they did not know about the matter. The report also stated that a judgment published in 2019 sentenced a then research and innovation director of Midea Group's small domestic appliances division to one year in prison for accepting RMB 70,000 in two payments in 2013 and 2014 from the head of a Midea Group supplier, and that the Foshan Intermediate People's Court dismissed his appeal. The judgments are not in the record, and the convicted employees are not named here. ¹

analysisThe same report cited Midea Real Estate's own anti-corruption disclosures: in 2017 its audit and supervision centre found 8 cases, 3 of them opened as criminal cases, involving 22 people, of whom 6 were arrested; in 2018 its risk control centre found 9 cases, 5 of which met the threshold for criminal filing, involving 19 people; and in 2019 it disclosed cases of staff manipulating the allocation and pricing of homes for sale and of a former project director accepting bribes from suppliers. These are internal cases that the company itself disclosed and in which it was the injured party, as summarised by the media; the underlying disclosures are not in the record. ¹

analysisA media report of 17 September 2012 stated that Gu Chujun, former chairman of ST Kelon, alleged at a press conference in Beijing on 14 September 2012, a week after his release from prison, that the judgment against him had been influenced by pressure from some CSRC officials and certain Guangdong officials, that these officials were suspected of a transfer of benefits with Midea, and that Midea, which coveted Kelon, had sought to acquire it at zero cost by buying off officials. In 2009 the Guangdong High People's Court had issued a final judgment sentencing Gu Chujun to 10 years' imprisonment and a fine of RMB 6.8 million for false registration of capital, unlawful disclosure and misappropriation of funds. According to the report, Guangdong Midea Electric stated that the remarks had no factual basis, that his fabrication and spreading of facts had seriously damaged the company's reputation and that it reserved the right to pursue his legal liability; the CSRC spokesperson said public supervision was welcome but must rest on facts and law, and an official named by Gu Chujun called the allegations lies. The allegation was made after his conviction, the report contains no evidence for it, and no court or regulator finding on it appears in the record. ¹