Microsoft, Motorola trial to resume Monday

The two companies are arguing over patent royalty rates for video and wireless networking technologies

Microsoft and Motorola are expected to begin arguments on Monday in the second part of a court case regarding patent licensing fees.

The jury trial in Seattle, one of a number of patent-related battles between major tech companies, will determine if Motorola breached its contract to provide certain technology to Microsoft on fair and reasonable terms.

Trouble between the two companies began in 2010 when Motorola asked Microsoft to start paying royalties for Motorola technology contributed to the H.264 video compression standard and 802.11 wireless networking standard. The former has become the de facto standard for streaming video while the latter underlies the Wi-Fi technology used in most gadgets today.

When tech companies contribute a patented technology to a standard, it typically does so on the understanding it will license the patent on fair, reasonable and non-discriminatory terms, which is abbreviated to "FRAND" in the industry.

This stops a company from waiting until a standard becomes widely adopted and then asking users for large sums of money. But that's essentially what Microsoft is arguing Motorola did.

The case is being heard in two parts.

In October last year, U.S. District Court Judge James Robart held a hearing to determine what level of royalties constituted fair and reasonable. The answer he delivered in April was US$1.8 million, a fraction of the $4 billion Microsoft said it would have paid at Motorola's demanded rate.

The jury trial will seek to decide if Motorola breached its contract in seeking a larger sum from Microsoft.

Microsoft is asking for several million dollars in damages, attorney fees and the cost of relocating a distribution center from beyond the reach of a German court to the Netherlands as part of a side case filed in Europe.

Jury selection is expected to be completed on Monday morning after which opening arguments will be heard on Monday afternoon. Each side has 16 hours to argue their case. A verdict is expected as early as next week.

The case is Microsoft vs. Motorola, 10-cv-1823, in the U.S. District Court for the Western District of Washington.

Martyn Williams covers mobile telecoms, Silicon Valley and general technology breaking news for The IDG News Service. Follow Martyn on Twitter at @martyn_williams. Martyn's e-mail address is martyn_williams@idg.com

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