{"id":749800,"date":"2013-05-06T09:00:12","date_gmt":"2013-05-06T13:00:12","guid":{"rendered":"http:\/\/gigaom.com\/?p=642425"},"modified":"2013-05-06T09:00:12","modified_gmt":"2013-05-06T13:00:12","slug":"eu-warns-motorola-over-standards-essential-patent-abuse","status":"publish","type":"post","link":"https:\/\/mereja.com\/index\/749800","title":{"rendered":"EU warns Motorola over standards-essential patent \u2018abuse\u2019"},"content":{"rendered":"

Europe’s antitrust authorities have warned Motorola, which is owned by Google, over its use of standards-essential patents as legal weapons. In doing so, the European Commission has partially backed the view of Apple, Microsoft and Cisco, all of which have argued<\/a> that no-one should try to win injunctions based on these patents.<\/p>

Standards-essential patents (SEPs) cover, as the name suggests, technology that is essential to certain standards. SEPs are supposed to be licensed by the patent-holder on so-called fair, reasonable and non-discriminatory (FRAND) terms — essentially, because this technology is so important, the patent holder is not supposed to try blocking rivals from using it as long as they are willing to pay a FRAND rate.<\/p>

In the case of Motorola, the SEPs in question cover part of the GPRS standard<\/a>, which is in turn part of the rather important GSM cellular standard. Motorola and Google tried to get Apple to pay a rate of 2.25 percent of the entire device’s sale price in order to use the technology. Apple said this wasn’t a reasonable rate and Motorola sued in Germany, eventually winning its case<\/a> and threatening the sales of iOS devices in that country. The Commission opened an investigation<\/a> into this in April 2012.<\/p>

Crucial to the Commission’s “statement of objections” today, Apple had agreed to let the German court set a reasonable licensing rate, but Motorola had pushed on with enforcing the injunction anyway. This showed Apple had been willing to pay something<\/em> to Motorola \u2013 without that willingness, the Commission suggested, it might not have stepped in.<\/p>

As the Commission summarized<\/a> its preliminary conclusion:<\/p>

“The seeking and enforcing of an injunction for SEPs can constitute an abuse of a dominant position in the exceptional circumstances of this case – where the holder of a SEP has given a commitment to license these patents on FRAND terms and where the company against which an injunction is sought has shown to be willing to enter into a FRAND licence.”<\/p><\/blockquote>

That said, Motorola maintained in its own statement today that “Apple had to make six offers before the court recognized them as a willing licensee.”<\/p>

A statement of objections is effectively a warning and an invitation to the target to defend itself \u2013 after that defence has been heard, the Commission will come up with a final judgement.<\/p>

In a statement<\/a> on Monday, EU Competition Commissioner Joaqu\u00edn Almunia said SEPs should not act as blockers to competition:<\/p>

“The protection of intellectual property is a cornerstone of innovation and growth. But so is competition. I think that companies should spend their time innovating and competing on the merits of the products they offer — not misusing their intellectual property rights to hold up competitors to the detriment of innovation and consumer choice.”<\/p><\/blockquote>

In its statement, the Commission highlighted the difference between its preliminary ruling and the U.S. Federal Trade Commission’s (FTC) proposed Consent Order<\/a> that would force Motorola to play by the FRAND rules — that order would only apply to Motorola’s future dealings, while the European Commission is preparing to rule on what Motorola has already done.<\/p>
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