Well I guess I didn't add to my original post that I just returned it and picked up another one. We'll see how it goes with this one. I agree that it is direction specific and here's a test to demonstrate.

Take you remote and hold it by the lower bottom portion down towards the battery cover. Hold it between your thumb and index finger. Hang it upside down so the top of the remote is pointing down towards the floor. Wait for the Harmony backlight to go out and swing the remote around back & forth. You'll notice it doesn't turn on.

Another reason I returned the remote was that my "Ch" button was very dim compared to the other buttons. But the new one backlighting is consistent thru the entire remote.