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Judge Says Motorola Patents Only Worth a Tuppence

Judge James Robart told Google that it was only entitled to charge Microsoft $1.8 million a year in royalties

A US federal court has cut the legs out from under Google’s ambitions to harry companies like Microsoft and Apple that need its standards-essential patents (SEPs) to function while it makes a packet off those self-same patents bought for $12.5 billion – its stated purpose in buying Motorola Mobility.

Judge James Robart told Google that it was only entitled to charge Microsoft $1.8 million a year in royalties for the widgetry it was asking $4 billion a year for.

He said the most Google could charge Microsoft was a half-cent a unit for the H.264 video-decoding technology used in Windows and Xbox – he said Motorola’s contribution to the standard didn’t provide “significant technological value to Microsoft's products” – and it could charge a tad less than 3.5 cents a unit for the IEEE 802.11 Wi-Fi technology used in Xbox, sums that would add up to about $1.8 million a year once you throw in eight cents a unit for any other Microsoft product using the Wi-Fi standard.

Google and its Motorola subsidiary wanted 2.25% of Microsoft retail sales.

The European Commission is investigating both Googlerola and Samsung on the same issue: what is a fair, reasonable and non-discriminatory (FRAND) price for technology pledged to a standard.

Since it enables interoperability, the decision favors consumers, who would otherwise have to pay a lot more for their devices.

The case, which has been pending the judge’s decision, still awaits the results of a trial in August as to whether Googlerola breached its contract to offer its SEPs on reasonable terms. The decision currently seems preordained.

The patent infringement suit Motorola originally filed against Microsoft in 2010 was supposedly set in train by Microsoft’s demands that Motorola license its patents covering its alleged IP claims on Android, claims that have been successfully pressed with the rest of the Android lot.

Unlike Microsoft Apple has refused to abide by any court-set royalties and is currently appealing its legal claims.

Google, on the other hand, agreed at the (ahem) nudging of the Federal Trade Commission not to use its patents to try to block the sale of products that comply with industry standards.

Naturally Microsoft, who argued for an annual payment of $1.2 million, was pleased with Robart’s findings.

FOSS Patents observed that “No US court has previously made a FRAND royalty determination at the request of an implementer of a standard.” It’s anticipating more of them.

More Stories By Maureen O'Gara

Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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