In a report by Bloomberg yesterday, Motorola Mobility won a U.S International Trade Commission (ITC) Judge’s initial ruling to block imports of Microsoft’s Xbox systems. Although this is just an initial ruling, it is another step towards the final ruling that is said to be issued in August. Judge David Shaw of the ITC stated that Microsoft was wrong in violating four out of five Motorola patents. The patents involved were one for establishing communication between the Xbox and accessories, two patents that are relevant to the industry standard for video decoding and another two for Wi-Fi technology.
One of the two Wi-Fi related patents were not infringed but one aspect of the other was claimed to be invalid. Motorola Mobility has demanded that Microsoft pay a 2.25% royalty on products that use its patents and if its demands are indeed met, it would mean that Microsoft would have to shell out an annual total of $4 billion year just in royalties. After the initial ruling, a spokesperson from Motorola Mobility released a statement that said, “We are pleased that the ALJ’s (Administrative Law Judge) initial determination finds Microsoft to be in violation of Motorola Mobility’s intellectual property. Microsoft continues to infringe Motorola Mobility’s patent portfolio, and we remain confident in our position. This case was filed in response to Microsoft’s litigate-first patent attack strategy, and we look forward to the full commission’s ruling in August.”
After losing the initial judgment, Microsoft too released a statement which said, “Today’s recommendation by the Administrative Law Judge is the first step in the process leading to the Commission’s final ruling. We remain confident the Commission will ultimately rule in Microsoft’s favor in this case and that Motorola will be held to its promise to make its standard essential patents available on fair and reasonable terms.” Before the final ruling, this one still needs to pass through a six-member commission so there is still plenty of time until the case perks up again in August.
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