Apple Says Motorola Abuses Patents, Shifts Legal Strategy

Apple Says Motorola Abuses Patents, Shifts Legal Strategy

Apple is taking issue with Motorola’s treatment of fair-use patents, filing a formal complaint about potential violations and pushing for changes to how patents are defended.

Motorola stated in its annual report with the Securities and Exchange Commission that Apple filed a formal complaint to the European Commission over Motorola’s use of FRAND patents. Apple alleged the rival manufacturer violated existing fair use laws with its use of the patents in a number of lawsuits.

FRAND patents, which allow reasonable use standards between patent owners and other manufacturers, are becoming central to many of the patent lawsuits embroiling the industry. Apple’s complaint follows previous attempts to urge the European Commission to change its treatment of FRAND, meaning Apple is focusing on updates to patent law as an alternative to courtroom battles.

Should Apple’s complaint trigger an investigation into Motorola’s use of its FRAND patents, Apple and other device makers will receive the ability to license Motorola-owned technologies that previously would have landed them in court.

According to Motorola’s own SEC filing, “Apple’s complaint seeks the Commission’s intervention with respect to standards-essential patents.” The FRAND patents provide the wireless industry with methods for using patented technology, described as “fair, reasonable and non-discriminatory,” under licensing agreements. Setting such industry standards would reduce competitive device makers from using patents against rivals in attempts to stop device bans or score a settlement.

Some lawsuits over FRAND patents already resulted in sales injunctions of devices. In one case, Motorola won a suit against the Apple over 3G technology on iPhones and iPads that resulted in an online sales ban, which Apple quickly appealed. A similar ruling fell in favor of Apple over slide-to-unlock technology applying to Motorola smartphones.

Patent infringement cases have the potential to balloon once Google’s approved acquisition of Motorola is complete, though Google promises it will allow fair licensing of its expanded catalog. Both Europe and the U.S. will be watching this promise closely — Apple’s formal complaint with the European Commission follows a letter asking for FRAND revisions, anticipating the thousands of mobile device patents now owned by Google.

Apple’s iPhone sales are also part of the picture, since Google is using its Motorola patent holdings to seek royalties from iPhone sales with new standards-essential agreements.

Potential changes to the FRAND laws could alter the legal landscape for patents, shifting toward standard arrangements for licensing agreements, and fewer lawsuits overall to distract device makers from their overall innovation.

But before regulators consider long-term changes, the European Commission could follow-up on Apple’s complaint looking into potential Motorola violations of FRAND, which could mean immediate penalties for Motorola. A similar investigation, also brought by Apple, is underway for Samsung regarding a patent on 3G technology, which is the basis for a number of the manufacturer’s infringement claims.

Apple may be tiring of lawsuits with Android makers, and its inquiries to European regulators show it may shift strategy to avoid costly settlements in favor of licensing. Asking for European Commission intervention pressurizes the battle between iOS and Android as they race to out-develop each others’ smartphones, but the potential outcome of new regulations would open new doors for companies to put their existing patents to good use.

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