Judge: Microsoft owes Google a small fraction of Motorola patent demands

msmotorolaA federal judge in Seattle has largely sided with Microsoft in a closely watched patent battle with Google’s Motorola unit, ruling that the Redmond company owes less than $1.8 million a year for its use of Motorola’s patented video and wireless technologies in Windows, Xbox and other products.

Motorola had originally sought a rate amounting to more than $4 billion a year, plus $20 billion in back payments.

The decision is the latest legal setback for Google involving Motorola’s patents. Earlier this week Apple won a key patent ruling against Motorola, as well. The search giant paid $12.5 billion to acquire Motorola, with the value of Motorola’s patent portfolio figuring largely into the deal, as Google positioned itself for a variety of patent fights.

The ruling in Seattle is victory for Microsoft in a case that promised to set a precedent in the realm of “standard-essential patents” — technologies that are required for companies to implement industry standards.

“This decision is good for consumers because it ensures patented technology committed to standards remains affordable for everyone,” said David Howard, a Microsoft corporate vice president and deputy general counsel, in a statement issued by the company.

In a statement, a Motorola spokesperson said, “Motorola has licensed its substantial patent portfolio on reasonable rates consistent with those set by others in the industry.” I’ve also asked if Motorola plans to appeal the ruling.

The Motorola patents at issue cover a portion of the technologies required to implement the 802.11 wireless and H.264 video standards, and the judge’s process for setting the royalties could provide a blueprint for establishing fair and reasonable rates for licensing other standard essential patents.

The 207-page ruling by U.S. District Court James Robart followed a trial in Seattle in November. Here’s the public version of the ruling, below.

Many of the redacted parts are references to the next-generation Xbox console, slated to be unveiled next month. The judge cleared the courtroom for testimony related to that product, to protect Microsoft’s trade secrets.

Microsoft Motorola Ruling