updated 06:53 pm EDT, Mon August 13, 2012
Motorola patents affirmed as FRAND; antitrust claim dismissed
Judge Barbara B. Crabb, judge for the Apple versus Motorola fair, reasonable, and non-discriminatory (FRAND) enforcement lawsuit in the Western District of Wisconsin, has entered judgements on several filings entered in the case. Motorola's motion for partial summary judgement of Apple's antitrust concerns has been granted in Motorola's favor, as well as the dismissal of Apple's interference claim regarding its business relationship with Qualcomm. The remainder of the judgements were ruled in Apple's favor, including important clarifications, pointing to the potential legitimacy of Apple's FRAND licensing complaint against Motorola.
Motorola's motion was granted not on the merits of Motorola's case--Apple could not prove that any damages had occurred at the time of the complaint, thus rendering the complaint moot. While Appple has argued that $30 million has been spent on legal fees and associated costs, American law doesn't allow legal fees to be used as an affirmation of loss or damage in an antitrust lawsuit. The judge also ruled that Motorola didn't interfere with Apple's relationship with Qualcomm, as Apple continued to buy chipsets from Qualcomm even after Motorola attempted to prevent the manufacturer from selling g to Apple.
Judge Crabb affirmed Motorola's patents being asserted against Apple as FRAND patents. The Judge found that Motorola was obligated to ETSI and IEEE to license its declared patents on FRAND terms, and Apple is a third-party beneficiary of the contractual obligations to license the technology. Furthermore, while submitting technical patents to ETSI for standards determination, Motorola didn't reveal any held patents that may need to be used before the adoption of the proposal into the standard, potentially holding back some for future use in litigations such as versus Apple and Microsoft. The Judge's ruling is similar to Judge Robart's decisions regarding the same wireless communications and H.264 patents in Microsoft versus Motorola.
Patent analyst Florian Mueller interpret today's rulings to mean that because Apple has won some summary judgements against Motorola, having "failed to meet its obligations to disclose standard-essential patents to the relevant standard-setting organization at the appropriate time," that "the odds are increasingly long against the possibility of the iPhone, the iPad, Windows or the Xbox being banned in the U.S. (be it by the ITC or by a federal court) over FRAND-pledged standard-essential patents."
Tim Cook, speaking at the D10 conference before all the letters started arriving at the ITC, said "This is an area where the patent system is broken today. No one should be able to get an injunction off a standards-essential patent." The CEO argues that Apple has never sued a competitor over a standards-essential patent, as it feels that such strategies are "fundamentally wrong."
The primary Motorola patent in the case is related to H.264 video playback libraries in both Apple's iPhone and Microsoft's Xbox 360, as well as a wireless implementation patent versus Apple. The only course of action the ITC has to remedy a patent dispute is an injunction against sales, generally intended to expedite a settlement between the two parties during the ban on sales. Motorola and parent company Google are currently under investigation by the FTC for FRAND patent abuse.