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Apple Suit Against Motorola Over FRAND Licensing Rates Dismissed

Posted by Unknown on from the stop-wasting-our-time dept.

chill writes "A suit by Apple claiming that Motorola Mobility, now owned by Google, is seeking unreasonably high license fees for the use of patents on wireless technology has been thrown out by a judge in Madison, Wisconsin. Last week, Apple told the court it would pay up to $1 per device for a license to Motorola patents covering cellular and Wi-Fi technologies. Motorola Mobility was arguing for a royalty payment of 2.25 percent on each device." From the article: "'At the final pretrial conference, I asked Apple to explain why it believed the court should determine a FRAND rate even though the rate may not resolve the parties' licensing or infringement disputes,' Crabb wrote in an order on Friday. 'I questioned whether it was appropriate for a court to undertake the complex task of determining a FRAND rate if the end result would be simply a suggestion that could be used later as a bargaining chip between the parties.'"

12 of 249 comments (clear)

  1. Apple also said... by sconeu · · Score: 4, Interesting

    Apple also said it would ignore the court's order if it chose more than $1/device.

    --
    General Relativity: Space-time tells matter where to go; Matter tells space-time what shape to be.
    1. Re:Apple also said... by jkrise · · Score: 4, Interesting

      Apple also said it would ignore the court's order

      Steve Jobs should've been alive.... and witnessed the humiliation his so-called thermonuclear war is bringing onto his beloved company.

      --
      If you keep throwing chairs, one day you'll break windows....
    2. Re:Apple also said... by TigerTime · · Score: 5, Interesting

      Wait, and wasn't Apple wanting something like $30/phone from Samsung for rounded corners, the bounce back patents, and a couple other small ones???

      $1 is laughable when compared to the importance of the phone.

    3. Re:Apple also said... by Tough+Love · · Score: 3, Interesting

      Regarldess of the merit of your speculation on the importance of rounded corners relative to the functionality of a phone, it would seem that the legal world is now coming around to the belated realization that rounded corners are not actually something you can patent.

      --
      When all you have is a hammer, every problem starts to look like a thumb.
    4. Re:Apple also said... by Tough+Love · · Score: 1, Interesting

      Apple did not make the cash pile they are sitting on because of the patents.

      Perhaps that has something to do with the fact that Apple lost more than $100 billion of market value in the last seven weeks, after becoming a patent troll.

      --
      When all you have is a hammer, every problem starts to look like a thumb.
    5. Re:Apple also said... by rtfa-troll · · Score: 3, Interesting
      You say

      Typically LTE percentage royalties comes from the cost of the LTE modem in the device. Apple would likely be happy to pay 2.25% of the Modem cost.

      The article says

      It said today it is setting a 1% royalty rate on handsets drawing on its LTE patents in an effort to jump start LTE device development.

      Of course, that 1% rate is subject to terms. “If an LTE chipset gets embedded in a $50,000 Mercedes Benz we won’t charge 1% of $50,000,” said Scott Wickware, Nortel vice president of marketing and strategy for carrier networks.

      (my emphasis). So in other words, they would still think about the percentage of the cost of the Mercedes, let alone the handset.

      --
      =~ s,(.*),<sarcasm>$1</sarcasm>,g if any_point_you_wish();
  2. Re:I do not understand by alen · · Score: 4, Interesting

    i'll get modded down but the way FRAND works is the rates are usually a few cents per device and you cross license any FRAND patents that you have as well. you don't have to license non-FRAND patents.

    apple doesn't have much FRAND patents but they have a lot of non-FRAND patents that others want. everyone else has lots of FRAND but not much non-FRAND that is wanted now. so its a game that lasts years

    in the end apple will write a huge check for back royalties and come to some kind of agreement on everything else

  3. Dismissed with prejudice by Solandri · · Score: 4, Interesting

    That means Apple cannot re-file the case again.

  4. Not only that by pem · · Score: 4, Interesting
    But Apple's response to Motorola opening a negotiation was a lawsuit.

    It's disingenuous for them to say that they will do something without the court ordering it, when the entire reason the court is involved is that they refused to even make an initial offer, choosing instead to pick what they thought would be the best venue to sue in. Obviously, that didn't work out so well for them after the judge figured out what was going on.

    1. Re:Not only that by The1stImmortal · · Score: 3, Interesting

      Indeed. However it's even more disingenuous (or perhaps even downright arrogant) to ask the court to set a price, but suggest that they don't wish to be bound by it, and only wish Motorola to be bound by it as a maximum. In fact, this inability of the court to set a binding judgement based on Apple's case seems to have been a big part of why the case was dismissed.

  5. Re:I do not understand by shutdown+-p+now · · Score: 3, Interesting

    The whole idea of FRAND is that the price is non-discriminatory. So the price is the same for everyone, but the form of payment may be different. I'm not discriminating if I charge one guy $2.50, and another guy pays $1.50 but also cross-licenses me a patent that would be cost equivalent $1.00.

  6. Re:I do not understand by Xest · · Score: 5, Interesting

    "No, no, no. Where do you get this from?"

    Reality, that's how it works. I'm sorry you don't like that.

    "What is this arbitrary "component" exclusion?"

    It's not arbitrary. An aircraft radio transponder for example is in itself a complete product. Although you'd probably rarely want to you can use it in isolation of any plane so you'd pay the FRAND rates on that particular product rather than whatever plane you plug it into.

    Besides, most of that tech is out of it's 20 year patent term anyway.

    "Any device is going to use more than an handful of those. A percentage of the total cost is absurd."

    The 2.5% rate is not per patent, it's for the full relevant portfolio of patents so said rate may well cover, say 50% of those patents, and another 2.5% to say Samsung, 40%, then say 0.5% to Nokia or whatever for the final 10%. The point being that it probably doesn't amount to much more than 5% to license for usage the entire wireless stack for a mobile phone whether wifi or gsm, 3g or lte. Most companies though mitigate the cost by cross-licensing their patents instead, so using this example, Samsung and Motorola probably just trade enough FRAND patents to not even bother charging each other. Apple's problem is that it wanted the FRAND patents free, but didn't want to give up any of it's useful patents like those related to multitouch in return. The percentage cost is irrelevant to most companies who aren't arrogant when it comes to patent negotiation.

    "Nobody pays FRAND royalties like that."

    Again, everyone does, and again, really, I'm sorry reality upsets you, but being upset about it doesn't change it. I'm also sorry you've clearly got no first hand experience of this topic, but ignorance of it doesn't make you right, it just makes you ignorant.