*UPDATE* This morning we received a statement from Motorola Global Public Relations on yesterdays ruling.
U.S. International Trade Commission judge David Shaw today ruled in favor of Motorola Mobility Holdings Inc. to block imports of Microsoft’s Xbox systems. Shaw said that Microsoft was violating four of five of Motorola’s patents. Now this doesn’t mean that Xbox imports are blocked right now. At this point the ruling now goes to a six member commission, and more than likely Microsoft will settle with Motorola if it comes to that point. Motorola Mobility claims that Microsoft is infringing two patents that cover aspects of an industry standard for video decoding, two for Wi-Fi technology and a patent on a way to establish communication between the Xbox and accessories.
Motorola Mobility has demanded that Microsoft pay a 2.25 percent royalty on products that use its inventions. Meanwhile Microsoft, has challenged Motorola Mobility’s right to bring patents that the company says cover essential aspects of an industry standard. Microsoft says Motorola Mobility is violating its commitment to license those patents on “reasonable and non- discriminatory” terms.
Motorola released the following statement to us:
We are pleased that the ALJ’s 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.
Full findings of the judge’s ruling have yet to be released until both companies can redact confidential information. If Motorola wins it claim the royalty cost to Microsoft could total upwards of $4 billion dollars a year.