Microsoft vs Motorola trial could reveal patent deals and sales figures

November 13, 2012
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Microsoft

You’d be forgiven if patent war fatigue is starting to set in. The petty squabbling over patent licensing has reached epic proportions in the mobile industry. The good news is that juicy details you’d never otherwise hear about the giants of tech are often revealed in the courtroom and it looks as though that will be the case in the Microsoft vs Motorola trial which kicks off today.

Microsoft and Google-owned Motorola both submitted a request to Judge Robart ahead of the trial to request that he keep certain financial details secret – they actually want him to clear the Seattle courtroom when licensing deals or sales projections are discussed. Robart said no. The actual documents won’t be made public, but testimony will be given in open court.

In his statement he wrote that if a witness discloses “pertinent terms, rates or payments” the information will be public and so will any documents the judge relies on to reach his opinion.

If you missed the news Microsoft and Motorola are fighting over fair rates for patent licensing on standard essential patents or FRAND patents. Basically Motorola requested 2.25 percent of the sale price of infringing hardware and software, in this case that includes the Xbox 360. Microsoft said, no way, that would cost us over $4 billion, and then suggested $1.2 million would be fair. As you can see there’s a bit of gulf between the two.

This case will have serious ramifications going forward. Google acquired Motorola Mobility in large part to get its hands on a patent portfolio which is packed with essential patents and has been trying to use them to combat major patent infringement suits from Apple and Microsoft. If the judge decides that a relatively low royalty is fair then his opinion is likely to be referred to by other courts and it will seriously weaken Google’s arsenal.

The ultimate aim is to keep these essential patents out of courtroom disputes by establishing a fair rate. It won’t stop Apple from aggressively pursuing cases with its portfolio of non-essential patents. A similar case with Apple claiming Motorola’s demands for royalties on its FRAND patents were unfair was canceled last week because Apple refused to pay more than $1 per iPhone and the judge felt that was inappropriate.

It seems the judges are getting sick of all this too. Judge Robert actually said back in the summer that he feels the companies are using the courts “as a pawn in a global, industry-wide business negotiation”.

We’ll keep you posted on what he decides, and on any juicy financial details that might emerge.

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