A court hearing set for today in Seattle will focus on a dispute between Microsoft and Motorola Mobility, potentially impacting Microsoft’s ability to sell the Xbox 360 and Windows 7 in some parts of the world. But the case will also be watched for a possible precedent in the broader debate over how companies should license patents considered key to industry standards.

Adding to the intrigue, the case will soon become Microsoft vs. Google, as the search giant gets closer to completing its acquisition of Motorola Mobility for $12.5 billion.

Motorola contends that Microsoft violates its patents involving the H.264 digital video technology. A court in Germany last week found Microsoft in violation of two of Motorola’s patents, ostensibly ostensibly preventing the Redmond company from distributing Windows 7, the Xbox 360 and other products in the country.

However, U.S. District Judge James Robart had blocked Motorola from acting on that order until further proceedings in his court.

Those proceedings start today. Microsoft says Motorola is obligated to license these patents on fair, reasonable and non-discriminatory terms (commonly known as FRAND) as part of its participation in standards organizations. The company says Motorola’s demand of 2.25 percent royalties from Microsoft are unreasonable.

Today’s hearing before Robart is expected to focus in part on whether Microsoft gave up its rights to reasonable terms on the patents when it filed the suit.

With its possible implications for future patent disputes, the case has attracted widespread attention and will be closely watched in the industry. See coverage today by Bloomberg News and the Wall Street Journal.

GeekWire will be in the courtroom tracking the arguments. Stay tuned for updates later today.

 

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