News

Judge Blocks Motorola's Effort To Ban Microsoft Products

• By Kurt Mackie
• December 04, 2012

A ruling by a U.S. federal court last week effectively halts Motorola's legal efforts to block the sales of certain Microsoft products in Germany and the United States.

Judge James L. Robart of the U.S. District Court for the Western District of Washington made the ruling, which concerned Microsoft's use of standard-essential patents owned by Motorola in Windows and Xbox products. Microsoft was willing to license the technologies. Consequently, Motorola wasn't harmed, according to the judge.

"This license agreement will constitute Motorola's remedy," the judge stated in the order, according to The Wall Street Journal. "Accordingly, Motorola cannot demonstrate that it has been irreparably harmed."

Judge Robart is scheduled to hand down a decision on what a "reasonable and nondiscriminatory" (RAND) rate would be in the dispute between Motorola and Microsoft sometime "early next year," according to an article by The Seattle Times. The Times notes that Robart's decision would be "the first time a federal judge would be issuing such a ruling." A jury would compare that rate to Motorola's licensing offer to determine if Motorola offered the license on reasonable terms or not, according to the article.

The standard-essential patents held by Motorola concerned the H.264 video codec that is used in Microsoft Xbox gaming consoles. Motorola wanted 2.25 percent for each unit sold by Microsoft or a ban on U.S. imports of Xbox machines, which are made in China. Motorola received a favorable ruling in May from a German court that enjoined sales of Windows 7, Internet Explorer and Windows Media Player 12 in Germany for violating Motorola's H.264 patents. However, Judge Robart's ruling made last week supposedly countermands that German court ruling.

The judge had acted earlier to prohibit the sales ban in Germany. In a preliminary injunction order in May, Judge Robart noted that he was imposing on the German court's ruling. However, he cited a reason for doing so, claiming that Microsoft had filed for relief in the Seattle court venue six months before Motorola brought its lawsuit in Germany.

Microsoft has contended that Motorola wanted too much for licensing standard-essential patents, which companies are supposed to be able to license under "fair, reasonable and nondiscriminatory" (FRAND) terms per the definition used in Europe, or RAND terms per the U.S. definition. Both Microsoft and Apple have complained to the European Commission about Motorola's FRAND patent claims. While international standards bodies may have some sway in identifying which patents are to be generally available to licensees as part of building a standard for an industry, the setting of royalty rates for FRAND patents seems to be a legal gray area.

Motorola Mobility was acquired by Google in May, largely to bolster Google's intellectual property holdings. Google fostered the Linux-based Android mobile operating systems, which competes with Microsoft's Windows Phone OS and Apple's iOS. Microsoft and Apple have sued or established intellectual property agreements with numerous hardware manufacturers using Android, largely on the basis of non-FRAND software patent claims. Consequently, Motorola's FRAND lawsuit claims are arriving in this context of a larger mobile platform war in which Apple and Microsoft have been frequently litigants, suing or extracting agreements from Google's hardware partners.

So far, Microsoft has been losing out badly in its smartphone competition with Android. Windows Phone had a 2.4 percent market share in the third quarter of this year, compared with 72.4 percent for Android and 13.9 percent for iOS, according to research by Gartner. However, Microsoft has been successful on the legal front. It's thought that Microsoft may make more money from its licensing agreements with device manufacturers using Android than it does from its own Windows Phone OS sales.