U.S. Courts deny injunctions requested by Motorola in two cases against Apple and Microsoft

On 5 December 2012 the U.S. Federal Trade Commission (“FTC”) filed an amicus curiae brief in the patent dispute case between Apple and Motorola Mobility in the U.S. Court of Appeals for the Federal Circuit. In this amicus curiae brief, the FTC supports a U.S. District Court order of 22 June 2012 which dismissed a request for an injunction by Motorola that could have blocked the sale of iPhones and iPads by Apple in the U.S.

This case involves patent infringement claims by Apple and Motorola against each other regarding the technologies which are used in tablets and mobile phones. By partial summary judgment some of the patent claims were dismissed on the merits. The District Court then dismissed the remaining claims, i.e. four Apple patents and one Motorola “standard-essential” patent since neither party had offered sufficient evidence to prove damages, an entitlement to injunctive relief or any other relief. Regarding Motorola’s demand for an injunction against Apple regarding patents that Motorola had committed to license on fair, reasonable and non-discriminatory (“FRAND”) terms, Judge Posner held that “by committing to license its patents on FRAND terms, Motorola committed to license the [patent] to anyone willing to pay a FRAND royalty and thus implicitly acknowledged that a royalty is adequate compensation for a license to use that patent.” Both parties appealed the order in the Federal Circuit.

In its amicus curiae brief the FTC states that in evaluating whether an injunction should be entered, the avoidance of patent hold-up is an important consideration. Hold-up or the threat of hold-up may deter innovation, distort investment and harm consumers. Furthermore, the threat of a hold-up may reduce the value of standard setting.

The FTC also asserts that the District Court properly applied the eBay factors when it denied Motorola’s request for injunctive relief. Motorola could not establish that it would be irreparably harmed or that monetary relief would be inadequate. The other eBay factors, namely the balance of hardships and public interest, can be expected to militate against injunctive relief for standard-essential patents. This is so because if Motorola wants Apple to refrain from using the UMTS telecommunications invention, without that invention such a device would not be a cell phone. Regarding the public interest factor, the FTC states that consumers would be harmed by being deprived of a popular product and in the long run they would be deprived of innovations by Apple.

The amicus curiae brief by the FTC comes less than a week after a U.S. District Court in Seattle refused an injunction requested by Motorola against Microsoft products because they could infringe standard essential patents. In this case Microsoft alleges that Motorola tried to charge an unfair price to Microsoft to use its streaming technology. According to Motorola they offered similar terms to those it has charged other electronics companies.

Judge Robart ruled on the injunction after a week of hearings in November over how much a patent holder can charge for technology which is considered an industry standard. In his ruling judge Robart stated that no injunction was necessary since both parties have agreed to license the technology. According to Judge Robart this decision is intended to apply to a similar dispute between these two parties in Germany. Both parties had until 14 December 2012 to file post-trial briefs and Judge Robart is not expected to rule until January 2013. [Nicole Daniel]