A federal judge in Seattle today has denied summary judgments to both Microsoft and Motorola Mobility in one of their ongoing patent disputes. That means the two companies will go to trial, which is scheduled for November, unless they can reach a settlement before then.
Judge James Robart, of the U.S. District Court of Western Washington, had indicated in a May hearing that he was inclined to deny both Microsoft and Motorola’s motions for summary judgment. Microsoft had asked the court to decide that Motorola breached a contract by demanding unreasonable licensing fees for use of some of its industry-standard patents. Motorola had asked the judge to decide that Microsoft gave up its rights to license those patents at reasonable rates when it sued, rather than engage in negotiations. .
(That hearing, as you might recall, was the one in which Judge Robart scolded both sides, saying: “The court is well aware it is being used as a pawn in a global, industrywide business negotiation.” He went on to say the conduct of both Microsoft and Motorola “has been driven by an attempt to secure commercial advantage. To an outsider looking at it, it has been arbitrary, it has been arrogant and, frankly, it has been based on hubris.”)
In reaching his decision today, Judge Robart concluded that “the entire basis for Motorola’s assertion that Microsoft has repudiated its rights to a RAND (reasonable and non-discriminatory) license is unwarranted.”
He also said that just because Motorola had agreed with a standards-setting organization to offer its standards-essential patents on RAND terms does not mean that initial offers have to be on such fair and non-discriminatory terms. But the judge also said that that doesn’t mean Motorola can “make blantantly unreasonable offers.”
What constitutes “blantantly unreasonable,” though, is yet to be determined, Robart said. He also said, in denying Microsoft’s motion, that the company had not proved that Motorola’s patents in question cover only a minimal amount of the technology involved in certain technologies used in Xbox and Windows 7.
Microsoft said in a statement: “This case is about Motorola breaking its promise to make its standard essential patents available on reasonable terms and putting the price and availability of consumer technology in jeopardy. Today’s decision underscores that Motorola made a promise to the industry which it now must keep, and we look forward to the November trial to determine the appropriate licensing royalty.”
We have requested comment from Motorola Mobiliy, which was acquired by Google, and will post when we get it.
[Update 2:55 p.m.: Motorola sent a statement, saying: “Motorola Mobility has acted in good faith and we will prove that at trial. We are pleased that the court is holding Microsoft to its word — to license our essential patents just as the vast majority of the industry has done.”]
[Update 4:11 p.m.: The U.S. Federal Trade Commission today said, in a separate case before the International Trade Commission, that Google’s attempt to block imports of Microsoft and Apple products that use Motorola’s standards-essential patents may hurt competition, according to Bloomberg.]