A judge in the US has ruled that Motorola cannot ban sales of Microsoft’s Xbox 360 game console because of a patent dispute.
The handset manufacturer is claiming that Microsoft should pay them $4 billion annually for using their connectivity and video-coding patents. The game console maker, on the other hand, argued that the technologies are only worth $1 million per year.
In relation to this, Judge James Robart denied Motorola’s request to ban the sales of Xbox 360. That is because the patents in question are FRAND-type innovations. These are inventions which the court has recognized as critical to industry standards and should be licensed on fair, reasonable and non-discriminatory terms. As posted on gaming website Kotaku yesterday:
Saying that the technology was “critical to industry standards”, and that Microsoft had agreed to pay their use (the battle was over how much Microsoft should be paying), Judge James Robart said any financial dispute could be settled at the end of the pair’s case, with no Xbox 360 ban necessary.
The ruling is also applicable in Germany.
FRAND and License-free Precedent
The reports were pointing out that the technologies included in the dispute are necessary to make use of videos coded in H.264 format, as well as to connect to the Internet over Wi-Fi.
In addition, the court indicated that the standing amount owed by Microsoft can be added to their bill once matter is resolved. That’s because is not challenging the need for a fee, but rather just how much Microsoft should pay.
Last May, a court in Germany granted Motorola’s request to ban Microsoft’s Xbox 360. Also included in the ban are the company’s Internet Explorer browser and Windows Media Player. Subsequently, a judge at the US International Trade Commission recommended an import and sales ban on Microsoft’s Asia-made console games on relevant grounds.
However, Motorola was not able to enforce either ruling, which causes the pending of Judge Robart’s ruling in Seattle.
The current legal dispute will now decide the fair license rate for the patents involved in the case. This is a decision that could act as a precedent for other similar litigations.
Moreover, a jury will be asked to rule about Motorola’s earlier suggestion. Prior to this, the company suggested that the two firms should reach an agreement whether 2.25 percent royalty fee is so high that it has placed them under breach of contract.