U.S. federal judge Richard Posner of the Northern District of Illinois on Friday dismissed Apple’s and Motorola’s smartphone lawsuits against each other, finding neither party had presented an adequate case. The dismissal doesn’t mark the end of legal wrangling between Apple and Motorola (and its new corporate parent, Google), but does represent a setback for Apple’s legal battle against Android—and a blow to Motorola’s efforts to charge Apple extra for licenses to patents available under FRAND terms.
Judge Posner had clearly been nonplussed by both Apple and Motorola’s claims for a while: he’d previously narrowed Apple’s claims that Motorola infringed on four Apple patents down to just one, characterized the case as “silly,” and early this month cancelled the case’s trial date and tentatively concluded that the case would have to be dismissed. However, he acceded to a request from Apple for one last chance to convince him the case should proceed—and in his final dismissal thoroughly chastised Apple for failing to present compelling evidence of damage. Posner also characterized a report from Apple’s damages expert as “demonstrably inadequate.”
“Apple attempts what I told its legal team at a pretrial conference I would not let it do in the liability trials then envisaged: turn the case into an Apple versus Motorola popularity contest,” Judge Posner wrote. “Apple is complaining that Motorola’s phones as a whole ripped off the iPhone as a whole. But Motorola’s desire to sell products that compete with the iPhone is a separate harm—and a perfectly legal one—from any harm caused by patent infringement.”
However, Posner didn’t let Motorola off the hook either. Motorola had been seeking an injunction on Apple for failing to license a Motorola patents related to UMTS mobile technology available under FRAND (fair, reasonable, and non-discriminatory) terms. Except Apple didn’t refuse to license the patent from Motorola, it merely refused to pay more than Motorola would charge to anyone else. Motorola been frequently criticized for leveraging its standards-essential patents in its legal battles, and Judge Posner made it very clear the strategy held no water with him.
“I don’t see how, given FRAND, I would be justified in enjoining Apple from infringing the ‘898 [patent] unless Apple refuses to pay a royalty that meets the FRAND requirement,” Posner wrote. “By committing to license its patents on FRAND terms, Motorola committed to license the ‘898 to anyone willing to pay a FRAND royalty and thus implicitly acknowledged that a royalty is adequate compensation for a license to use that patent.”
Judge Posner’s dismissal could have ramifications for other cases where Motorola is trying to leverage its standards-essential patents—such as its ongoing litigation against Microsoft, where it is demanding a 2.25 percent royalty on every Xbox sold. Posner’s is effectively an endorsement of the the position advocated by Apple, Microsoft, Cisco, and others that regulatory agencies should not grant product injunctions in patent disputes over standard-essential patents.
Apple and Motorola’s next confrontation should be at the U.S. International Trade Commission; Apple already lost the first round of that fight, but the complaint is due to be heard by the ITC’s full panel. The companies are also going after each other in a number of international venues.
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