Motorola Mobility Gets EU Antitrust Complaint Amid Apple Clash
By Stephanie Bodoni – May 6, 2013 7:10 AM ET
Google Inc. (GOOG)’s Motorola Mobility unit was sent a European Union antitrust complaint for abusing its dominant position as part of a probe into its control of key patents in gadgets such as Apple Inc. (AAPL) iPhones and iPads.
The EU antitrust regulator said it suspects that Motorola Mobility, which Google bought last year for $12.4 billion, is abusing its dominant position by “seeking and enforcing” injunctions against Apple in Germany based on its patents that are essential for products to comply with industry-agreed technical standards.
“Companies should spend their time innovating and competing on the merits of the products they offer — not misusing their intellectual property rights to hold up competitors to the detriment of innovation and consumer choice,” EU Competition Commissioner Joaquin Almunia said in an e-mailed statement from Brussels today.
The EU is cracking down on patent abuses as Motorola Mobility, Microsoft Corp. (MSFT), Apple and Samsung Electronics Co. trade victories in divergent court rulings across the world on intellectual property. Almunia last year sent Samsung a formal complaint over its patent-use and is targeting “rules of the game” to prevent companies from unfairly leveraging their inventions to thwart rivals.
The EU opened a formal probe into Motorola Mobility, which makes smartphones that run on Google’s Android software, in April 2012, following complaints by Microsoft and Apple. The two U.S. companies accused Motorola Mobility of seeking injunctions to block their use of patents they said the Google unit had declared to be essential for the production of standard- compliant products and had promised to license on terms that are “fair, reasonable and non-discriminatory.”
While today’s announcement concerns Motorola Mobility’s disputes with Apple in Germany, the part of the probe concerning Microsoft products is continuing, Jonathan Todd, a spokesman for the European Commission, told reporters.
“We agree with the European Commission that injunctions should only be sought against unwilling licensees and, in this case, Motorola Mobility followed the procedure established in the German Supreme Court’s Orange Book ruling,” Katie Dove, a spokeswoman for Motorola Mobility, said in an e-mailed statement. “Apple had to make six offers before the court recognized them as a willing licensee.”
The commission said today that “while recourse to injunctions is a possible remedy for patent infringements, such conduct may be abusive” in the case of standard-essential patents owners where “the potential licensee is willing to enter into a license on fair, reasonable and non-discriminatory, so-called ‘FRAND,’ terms.”
Industry-standard technology helps ensure products such as mobile phone antennas and global-positioning system software can operate together when made by different manufacturers.
Almunia has said the EU investigation on patents differs from corresponding parts of the U.S. probe into Google that ended earlier this year when the company agreed to lift injunctions for patents it inherited from Motorola Mobility.
After receiving the commission’s objections, companies can defend themselves in writing or at an oral hearing before the EU’s antitrust authority decides to impose fines.
An EU settlement avoids any fines and a decision on whether a company broke antitrust rules. Companies can be fined as much as 10 percent of their annual revenue if they break the terms of a legally binding settlement.
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