Google’s Motorola Unit Can’t Ban Microsoft Products In Germany

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Google’s Motorola Mobility unit can’t ban the Xbox 360 in Germany over patents

Google’s Motorola Mobility unit cannot enforce an injunction it obtained against Microsoft in Germany, a US appeals court ruled on Friday, dealing Google and its Android smartphone operating system a setback in the company’s ongoing patent war with Microsoft.

At the centre of the battle is Google’s widely used Android smartphone operating system, which Microsoft began attacking in 2010 in an effort to obtain patent licensing arrangements with companies that make Android-based products. To date, Google-owned Motorola Mobility remains the only major Android manufacturer not to have agreed to a licensing deal with Microsoft.

Patent wars

Instead, Motorola Mobility has responded with patent lawsuits of its own against Microsoft, and in May won an injunction in Germany that would have prevented Microsoft from “offering, marketing, using or importing or possessing” certain products including its Xbox 360 games console and some Windows software in that country.

On Friday, however, the 9th US Circuit Court of Appeals in San Francisco upheld an earlier ruling by US District Judge James Robart in Seattle that put the German sales ban on hold. The court ruled that the poll should be suspended given that Google and Microsoft are involved in a breach-of-contract lawsuit which covers the patents at issue in the German case.

“It is clear that there is a contract, that it is enforceable by Microsoft, and that it encompasses not just US patents but also the patents at issue in the German suit,” the court said.

The breach-of-contract lawsuit will begin in November in a federal court in Seattle.

Microsoft contends that Motorola is asking far too much for licenses to the patents in question. The Windows maker argues that the patents Motorola Mobility is leveraging are what are called “standard-essential”, meaning Motorola is obliged to license them at fair, reasonable and non-discriminatory (FRAND) rates.

Motorola is demanding Microsoft pay it royalties for patents related to the Wi-Fi standard and the H.264 video codec standard, demands which according to Microsoft would add £14 to the price of a £638 laptop. Microsoft and Apple filed an antitrust complaint with the European Commission in February, claiming the mobile manufacturer was using FRAND patents to block product sales.

In April Microsoft closed its German distribution centre, with plans to shift to the Netherlands, saying its presence in Germany was not worth the risk of a product ban.

Setback for Google

“We’re pleased that Judge Robart’s decision has been affirmed by the Ninth Circuit Court of Appeals, preventing Motorola from enforcing an injunction in Germany until its use of standard-essential patents can be closely examined,” said David Howard, corporate vice president and deputy general counsel for Microsoft, in a statement. “It continues to be our hope that Google and Motorola live up to their promises to standards organisations.”

Florian Mueller, a consultant on patent issues, argued that Google’s use of Motorola’s standard-essential patents to defend Android is “abusive”, and said it appears to be only a matter of time before Google is obliged to offer Microsoft a licence on “truly FRAND terms”.

“In light of this unsuccessful appeal to the Ninth Circuit, Google should think even harder about taking a license to all those Microsoft patents that read on Android,” Mueller write in a blog post.

Google did not immediately respond to a request for comment.

Last month Microsoft secured a third patent victory against Motorola in Germany, adding to the pressure on Motorola to obtain a licence for Microsoft’s technology.

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