As Apple continues to hold unfruitful settlement talks with Samsung, it seems to have reached an impasse with Motorola as well. The iPad-maker has submitted a new court filing, accusing the Google-owned company of overcharging for its standards essential patents.
The complaint lodged against Motorola was filed with the U.S. Court of Appeals for the Federal Circuit today, as part of Apple’s opening brief in an appeal effort. Apple wants the court to force Motorola—which is Google at this point—to license its technology at a fair price…
Last year, word got out that Motorola was asking Apple for 2.25% of its device sales in exchange for the use of its patents. And doing the math, Apple figures that comes out to about $12 per iPhone, which it claims is 12 times the going rate. FOSSPatents has the filing:
“The most interesting economic information is that Motorola, according to the brief, “demand[s] that Apple take a license at a rate that was more than 12 times what Motorola was charging other licensees for the same technology–a rate that was unfair, unreasonable, and decidedly discriminatory”. The public version of the brief obviously does not contain any such thing as a list of various Motorola license deals. But it becomes clearer and clearer that Motorola’s 2.25% demand is unrealistic and not supported by the deals it actually concluded.”
So here’s the deal. When companies have what are considered to be ‘standards essential’ patents—inventions required by industries (think car engine), they’re expected to license that tech under FRAND (fair, reasonable and non-discriminatory) terms to other companies.
Motorola, having been in the wireless industry for some 50+ years now, has a lot of patents in the field. And Apple, of course, needs some of them. But it’s saying the request of 2.25% of sales is anything but fair and reasonable, and it wants the court to do something about it.
That’s why it’s appealing Judge Barbara Crabb’s November 2012 dismissal of its FRAND contract and antitrust complaint. Because if it doesn’t, it’ll either have to pay the 2.25% or continue getting sued by Motorola over these patents, which could lead to another sales ban.
It may not seem like it, but this is a significant battle between the two companies. And it gets even more interesting when you consider that Google is pulling the strings here.