EC Opens Motorola Patent Antitrust Investigation

The European Commission (EC) has announced it has opened a formal antitrust investigation into Motorola Mobility.

Apple and Microsoft had complained in February that Motorola was abusing its market position by not offering standard-essential patents under fair, reasonable and non-discriminatory terms (FRAND).

Abusing its position?

“The Commission will assess whether Motorola has abusively, and in contravention of commitments it gave to standard setting organisations, used certain of its standard essential patents to distort competition in the Internal Market in breach of EU antitrust rules,” the Commission said in a statement.

Motorola made FRAND commitments when the 2G, 3G, WLAN and H.264 video compression standards were set, and the Commission’s task will be to see whether by seeking injunctions against Apple and Microsoft products that use standards-essential patents, they are failing to honour these commitments.

Specifically, the Commission will see if Motorola has violated Article 102 of the Treaty of the Functioning of the EU (TFEU), which “prohibits the abuse of a dominant position which may affect trade and prevent or restrict competition.” It will also see if allegations that Motorola offered Apple and Microsoft unfair terms for licensing the patents, which is in breach of the same article.

A court in Mannheim, Germany is expected to rule on 17 April if Microsoft violated Motorola’s patents needed for the H.264 video codec standard in its products. Microsoft has claimed that Motorola’s demands are unreasonable and has relocated its distribution centre from the country to the Netherlands amid fears the sale of its products could be banned.

Investigation ‘inevitable’

Analyst Florian Mueller said that an investigation was inevitable after Motorola’s aggressive conduct, claiming the company obviously hadn’t learned from Samsung’s experience. The EC opened an investigation in February to see whether Samsung was trying to illegally hinder competition through its patents, including one required for standardised 3G technology.

“Today’s announcement by Europe’s top antitrust authority also comes at a very interesting timing with a view to developments in Germany, not only Europe’s but even the world’s hotbed of FRAND patent abuse,” said Mueller. “Germany is the only EU member state in which Motorola is suing Apple and Microsoft over standard-essential patents.

“The Commission’s decision to launch these formal investigations should serve as food for thought for certain judges in the largest EU member state who have shown a worrying tendency in recent years (and especially in recent months) to put patent law far above antitrust law.”

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