On Thursday, a federal appeals court decision was made in favor of Microsoft in a patent dispute case with Google over Motorola patents. This case was originally filed in 2010. This was a major setback for Google for the appeals court to rule that the low licensing rate Microsoft pays to use Google’s Motorola Mobility patents have been properly set. The court also upheld the $14.5 million that was awarded to Microsoft for Motorola’s breach of contract to license its patents in a fair manner.
THE MICROSOFT, MOTOROLA AND GOOGLE CASE ALL BEGAN WITH A LETTER
San Francisco’s Ninth Circuit Court of Appeals discovered that a lower judge had indeed acted appropriately when he took it upon himself to figure out what would be a fair price to use standard essential Motorola patents for Microsoft. The dispute began when a letter was sent from Motorola to Microsoft requesting that the company pay $4 billion per year in order to license patents related to the 802.11 standard, this underpins wifi, and the H.264 video encoding standard.
GOOGLE ACQUIRED MOTOROLA AND THEIR PATENTS IN 2012
Motorola took major issue with the decision because Microsoft was introduced to the lower court’s calculated patent licensing rate to the jury. Motorola argued that the introducing rate led to the jury ruling in favor of Microsoft.
Google acquired the Motorola patents as a part of its acquisition of Motorola, back in 2012 for $12.5 billion. However, the dispute between Microsoft and Google increased when Google sold Motorola to Lenovo. The lower court’s ruling was an unexpected decision by the judge to set parameter for licensing negotiations. However, after the appeals court decision came in favor of Microsoft, the decision was upheld.
APPEALS COURT UPHELD $14.5 MILLION AWARD TO MICROSOFT
The appeals court also upheld the jury’s decision to award $14.5 million to Microsoft in a trial related to this one. This case drew major interest from a variety of technology companies including Apple and Intel, who were in support of Microsoft, and Qualcomm and Nokia in support of Motorola.
The appeals court decision that was in favor of Microsoft might affect any future cases in patent licensing under similar terms.