Europe launches Motorola patent investigation

The EU has finally had enough of Motorola’s patent use and announced an investigation into whether it has been using standards patents to get an edge over its rivals.

Motorola Mobility, in the process of being bought by Google, is accused of abusing its position to demand large royalty payments from other companies over 3G wireless technologies.

The European Commission has now opened two antitrust cases against Motorola, and will be taking a look into its attempts to seek injunctions on a range of devices from Apple and Microsoft.  

While Microsoft may have been guilty of throwing its own not-inconsiderable weight around in times gone by, the company feels aggrieved by the tactics employed by the mobile firm.

According to the EU, the investigation will examine alleged attempts to “distort competition” as a “matter of priority”.

The European Commission said there would be no witch hunt, however, as it “does not prejudge the outcome of the investigations”.

Samsung has also felt the force of the European Commission regarding FRAND patents, with an investigation underway regarding the various lawsuits it has levelled against Apple in their tit for tat row.

The patents used by Motorola in such cases are thought to have been part of standards declared essential to mobile communications devices.

However, in an increasingly aggressive patent landscape, the patents have been alleged to have been used to demand lucrative royalty deals from Microsoft and Apple. The Commission will also be looking at whether this has been the case.

With Google nearing finalisation of its acquisition of part of Motorola’s business, the antitrust cases are mounting up.  Google is already under investigation from the EC for its own allegations of abusing its dominant position, so if nothing else Motorola will have a certain amount of expertise to lean from.

Patent expert Florian Mueller said that there is a high chance that the EC will find Motorola has been up to no good: “It’s a foregone conclusion that Motorola’s royalty demands are entirely unFRANDly,” Mueller cracked wise to TechEye.

“For example, they’re demanding 2.25 percent of the price of an entire PC running Microsoft Windows, which would amount to $4 billion in annual royalties even if the average selling price of a PC was $500, though it’s considerably higher,” he said.

He believes that there is some hope that, along with the case against Samsung, a crack down by the EC on FRAND patent abuse can help curb such instances in future.

“Motorola’s ability to seek and enforce injunctions against Apple and Microsoft, as well as anyone else they might have wanted to attack, would be impaired,” he said.

“The two Motorola investigations as well as the Samsung investigation are, collectively, a landmark set of cases of transcendental importance. They can teach everyone a lesson that FRAND commitments must be honored.”

The wider problem for Google, however, is pertinent.  With the EC already on Google’s tail, heaping antitrust case on antitrust case is likely to be giving Google’s legal team a major headache.

“Google should choose its battles more wisely. It can’t fight against antitrust regulators on all fronts,” Mueller said.

By cooling off on its royalty demands, Google should be able to resolve the situation somewhat.

“As soon as it closes the Motorola deal, Google should ensure that Motorola’s royalty demands will go down to a more reasonable level and that its pursuit of sales bans over standard-essential patents comes to an end,” Mueller said.