Microsoft awarded $14m damages over Motorola FRAND failings

Motorola, which is owned by Google, has indicated that it will appeal the decision which was made by a jury sitting in a federal court in Seattle, according to media reports.

According to a Reuters report published by the New York Times, $11m was awarded to Microsoft to compensate it for relocating a warehouse in Germany after a court in the country served an injunction banning Microsoft products being sold there. Approximately $3m was also awarded to Microsoft to cover legal fees the company paid in challenging the serving of that injunction, the report said.

"We're disappointed in this outcome, but look forward to an appeal of the new legal issues raised in this case," a Motorola spokesman said, according to a BBC report.

Microsoft described the ruling as a "landmark win for all who want products that are affordable and work well together," according to the report.

The patents at issue in the trial relate to the H.264 video compression standard and the IEEE 802.11 standard for wireless technology.

Standards are agreed technical specifications to ensure that a single technology is used across an industry, often with the goal of achieving interoperability of products regardless of the manufacturer.

Companies can opt to send experts to help develop standards but, in return, most standards setting organisations insist that companies agree to license any intellectual property they own that is essential to implementation of that standard on FRAND terms.

Earlier this year the European Commission said that it was its preliminary view that Motorola had breached EU competition rules by seeking and enforcing an injunction against Apple banning its rival from using technology it had helped to develop and holds patent rights for.

It said, provisionally, that Motorola had abused a dominant market position when seeking and enforcing the injunction because Motorola had agreed to licence the use of its standard-essential patents, for technology used in mobile and wireless communications, on FRAND terms and because Apple had shown that it was "willing" to agree a licensing deal on such terms.

The Court of Justice of the European Union (CJEU) has been asked by a court in Germany to rule whether standard-essential patent holders, having agreed to licence to others the use of their patents on fair, reasonable and non-discriminatory (FRAND) terms, can automatically be said to be abusing a dominant market position by initiating legal action in pursuit of an injunction against those infringing their patents where those infringers have declared a willingness to negotiate a licensing deal for the use of their patents.

"The important question here is what does 'willing' mean?" competition law expert Natasha Pearman of Pinsent Masons, the law firm behind Out-Law.com, said at the time. "The Commission in its recent statement of objections against Motorola suggests that 'willing' is the acceptance of binding third party determination for the terms of a FRAND licence, in the event that bilateral negotiations are not successful. If this is the position that the CJEU also advocates, then I could see how bringing an action for injunction could be an abuse of dominance."