Item 3. Legal Proceedings

In the Matter of Certain Marine Sonar Imaging Devices, Including Downscan and Sidescan Devices, Products Containing the Same, and Components Thereof

On June 9, 2014 Navico Inc. and Navico Holding AS (collectively “Navico”) filed a complaint with the United States International Trade Commission (“ITC”) alleging the Company infringed upon three specific Navico patents relating to downscan sonar. On December 1, 2015, the ITC issued a Final Determination concluding that there was infringement by Garmin. On August 30, 2016, Navico filed a request that the ITC initiate an enforcement proceeding for alleged violations by Garmin of the previous cease and desist orders issued by the ITC. On May 26, 2017, the Administrative Law Judge issued his initial enforcement determination concluding that Garmin’s sale of certain DownVü sonar products violated the ITC’s December 2015 orders and recommended a civil penalty of $37 million. On June 13, 2017, the U.S. Court of Appeals for the Federal Circuit (“Federal Circuit”) reversed the ITC’s Final Determination. Specifically, the Federal Circuit ruled that the two of the three patents in the suit are invalid and that Garmin does not infringe upon the third patent. The ITC stayed the issuance of a final determination in this enforcement proceeding pending the issuance by the Federal Circuit of its mandate. The Federal Circuit issued its mandate on October 31, 2017. Pursuant to the settlement agreement described below on February 14, 2018, Garmin and Navico filed a joint motion to terminate the enforcement proceeding.

Navico Inc. And Navico Holding AS v. Garmin International, Inc. and Garmin USA, Inc.

On June 4, 2014 Navico filed suit in the United States District Court for the Northern District of Oklahoma alleging the Company infringed upon the same three specific Navico patents relating to downscan sonar that are the subject of their complaint filed with ITC discussed above. On January 15, 2016 the court issued an order staying this lawsuit pending the final determination of any appeal filed with the Federal Circuit concerning that ITC complaint. On October 31, 2017 the Federal Circuit issued its mandate in that appeal holding that two of the three patents in suit are invalid and that Garmin does not infringe upon the third patent. On November 14, 2017, the Oklahoma court lifted the stay and set a briefing schedule. The parties have submitted briefing on the effect of the Federal Circuit’s decision and the court scheduled a hearing on March 12, 2018. This lawsuit was dismissed with prejudice on February 13, 2018 pursuant to the settlement agreement described below.

Navico Inc. And Navico Holding AS v. Garmin International, Inc. and Garmin USA, Inc.

On March 4, 2016, Navico filed suit in the United States District Court for the Eastern District of Texas, Marshall Division alleging the Company infringed upon two specific Navico patents relating to downscan sonar. On September 8, 2017, a jury returned a verdict finding that Garmin had willfully infringed upon those two patents and awarded damages of $38 million. No judgment was entered by the court. This lawsuit was dismissed with prejudice on February 13, 2018 pursuant to the settlement agreement described below.

On January 24, 2018, Garmin and Navico agreed on a global settlement of all pending litigation between them. The settlement is not material to the Company’s financial condition or results of operations. The parties have agreed to keep the terms of the settlement confidential.

PulseOn Oy v. Garmin (Europe) Ltd.

On November 11, 2016, PulseOn Oy filed suit in the Patents Court in London, England, against Garmin (Europe) Ltd. alleging infringement of alleged UK unregistered design rights and Registered European Community Design No. 002473769-0004 (the “0004 Design”) and Registered European Community Design No. 002473769-005 (the “0005 Design”) by certain Garmin products with wrist-worn heart rate monitors. A trial was held in November 2017. During the trial PulseOn abandoned its claim of infringement of alleged UK unregistered design rights. On January 18, 2018 the court issued a judgment holding that no accused Garmin products infringed either the 0004 Design or the 0005 Design.

In the normal course of business, the Company and its subsidiaries are parties to various legal claims, actions, and complaints, including matters involving patent infringement, other intellectual property, product liability, customer claims and various other risks. It is not possible to predict with certainty whether or not the Company and its subsidiaries will ultimately be successful in any of these legal matters, or if not, what the impact might be. However, the Company’s management does not expect that the results in any of these legal proceedings will have a material adverse effect on the Company’s results of operations, financial position or cash flows.

The Company settled or resolved certain other matters during the fiscal year ended December 30, 2017 that did not individually or in the aggregate have a material impact on the Company’s financial condition or results of operations.