EU warns Motorola in patent spat with Apple

The smartphone-making division of Google is sent a formal list of complaints by the EU for allegedly abusing its position in the market over recent patent litigation with Apple.

The European Commission has sent Motorola, a division of Google, a formal list of complaints over how it conducts its patent litigation and subsequent enforcement.

The EU said in a statement today that Motorola had been informed of its allegations -- what is known as a formal "statement of objections" -- claiming that the smartphone maker had abused its market position by seeking and enforcing a patent-related injunction against Apple.

The iPhone and iPad maker was told by a court in Germany that it must stop using a networking patent relating to GPRS technology. But Motorola could find itself in trouble because while a court sided with Motorola, Apple declared it was willing to pay royalties to its rival.

Arguing that these patents are essential to the wider industry for interoperability and core functionality, such injunctions can be brought against other firms but not if a potential licensee was willing to agree on negotiated terms.

Apple filed a complaint with the Commission accusing Motorola of turning its back on "fair and reasonable" (FRAND) licensing terms.

Licensing deals of patents essential to the industry requires companies' license out their inventions under conditions that do not harm competition, or could be seen as extortionate or too expensive for rival firms.

The Commission said in a statement today that "considers at this stage that dominant [standards-essential patent] holders should not have recourse to injunctions, which generally involve a prohibition to sell the product infringing the patent, in order to distort licensing negotiations and impose unjustified licensing terms on patent licensees."

Arguing this in breach of European competition and antitrust law, EU Competition Commissioner Joaquin Almunia said in prepared remarks:

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."

If Motorola is found to have broken EU antitrust laws, as its parent company, Google could be fined up to 10 percent of Motorola's global annual revenue for infringing years, amounting to as much as $1.3 billion (0.99bn).

This story originally appeared at ZDNet's Between the Lines under the headline "EU sends Motorola antitrust charges over Apple patent litigation."

 

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