Ninth Circuit will hear Microsoft v Motorola SEP row

The US Court of Appeals for the Ninth Circuit will today (April 8) hear arguments in the battle between Microsoft and Motorola over the licensing of standard-essential patents (SEPs).

Microsoft has claimed that Motorola’s licensing demands for SEPs that Microsoft used in its Xbox games console and Windows operating system breached reasonable and non-discriminatory (RAND) terms.

The case concerns SEPs related to the H.264 video and the 802.11 wireless industry standards.

Microsoft sought a judgment from the US District Court for the Western District of Washington in 2013 on whether Motorola’s demands of $4 billion a year violated RAND terms.

All SEPs are required to be licensed on RAND terms. Typically outside of the US the licensing of SEPs is referred to as FRAND (with the 'F' referring to 'fair').

The case was split in two with a judge and jury ruling on different aspects in 2013.

In the first part, Judge James Robart ruled that a “reasonable royalty” was about $1.8 million a year. In the second part, a jury determined that Motorola had breached RAND licensing commitments over the SEPs and was subsequently fined $14.5 million.

Motorola then appealed against the decision at the ninth circuit.

Later, in a brief submitted to the court in November last year outlining its arguments, Microsoft said that “overwhelming evidence” supported the jury’s finding that Motorola breached its RAND licensing commitments.

In response, Motorola said that if the district court’s judgment is affirmed then SEP infringers will “pay nothing for those patents for years and file pre-emptive contract suits that block meaningful enforcement”.