Washington court tells Motorola to expect millions, not billions

U.S. District Judge James Robart, in a Seattle federal court, ruled that Microsoft should pay Motorola $1.8 million a year to license some of the latter's standards-essential patents. These are patents that are required to build certain devices and the negotiations for licensing them are supposed to be done in a "Fair, Reasonable, and Non-Discriminatory" manner. The patents in question deal with Motorola's patents for the H.264 video standard and the 802.11 wireless standard. Motorola was seeking $4 billion a year from Microsoft for the rights to use the patents.

In making the ruling, the court said that there were 92 different companies with patents related to the 802.11 wireless standard. If each company were to receive the 1.15% to 1.73% royalty that Motorola is demanding, the cost of using the wireless networking standard would exceed what Microsoft is asking for the Xbox which uses the 802.11 wireless technology.

Both sides issued statements afterward with Microsoft Deputy General Counsel David Howard saying, "This decision is good for consumers because it ensures patented technology committed to standards remains affordable for everyone." Motorola simply said that it "...has licensed its substantial patent portfolio on reasonable rates consistent with those set by others in the industry.”

An Administrative Law Judge last month ruled that Microsoft did not infringe on Motorola's patents covering H.264 and 802.11. This is a separate issue than determining what Microsoft should pay to license the same exact patents. The entire 6 member ITC commission is reviewing that decision.

source: AllThingD