With Microsoft’s rival, Google, acquiring Motorola, an ongoing IP battle between Microsoft and Motorola regarding patented technology in Microsoft’s popular Xbox may be taking on new significance.
This dispute could also involve anti-trust allegations, and raises issues of freedom of contract, licensing, unfair competition, and more.
The hearing Judge described this case as follows:
“The court is well aware it is being used as a pawn in a global, industrywide business negotiation … 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.”
Motorola is seeking 2.25% royalties from Microsoft, which Microsoft alleges could be as much as $4 Billion per year. Motorola has accused Microsoft of inflating that figure.
Motorola’s patents at issue are described as “industry standard,” which apparently suggests the IP is widely licensed at a lower royalty. So, does Microsoft have the right to a similar royalty rate as another company licensing the same volume? Microsoft apparently thinks so. Also, where is the irreparable harm here necessary to preserve the status quo? My 13 year old twin boys and 15 year old son would argue that sales of Xbox are the status quo and Microsoft is likely good for the monetary judgment, but at what royalty rate?
Motorola has an injunction from Germany that is presently unenforceable due to a TRO in favor of Microsoft issued from the Seattle District Court.
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