Microsoft and Motorola’s legal battle, in which Motorola claims Microsoft has infringed on several of their patents, has reached new heights as Judge John Shawn as put forward a recommendation that the 4gb and 250GB versions of the Xbox S, or Xbox Slim as many know it, should be banned from being imported into the country, and that the sale of said consoles already in the country should be stopped via a cease and desist order. Finally he also made the recommendation that Microsoft should post a bond equal to 7 percent of the declared value of unsold Xbox consoles already in the country. Ouch!
All of this comes after Motorola filed a complaint with the ITC back in 2010, stating that Microsoft had used Motorola-developed technology in its Xbox which allows set-top boxes to decode transmissions between its Droid2 and DroidX mobile devices. Microsoft claim that Motorola refuse to abide by the requirements set by the Institute of Electrical and Electronics Engineers Standards Association which to set reasonable license fees for the use of essential technology.
Shaw’s recommendation that imports of the Slim console follow on from his determination in April of this year that Microsoft had indeed infringed upon four of Motorola’s patents relating to secure wireless communication and video transmission. Microsoft have argued that Shaw’s recommendation that the Xbox be import banned does not serve the public interest because it would leave consumers with just two options to satisfy their needs, which of course is the Playstation 3 and the Wii. However, Shaw was having none of it, saying that the public interest of enforcing intellectual property rights outweighed any economic impact on consumers. He also pointed out that Microsoft didn’t even try to show that Sony and Nintendo were incapable of meeting the demand for consoles.
To make matters even worse, Microsoft and Motorola were completely opposed in regards to what the bond value should be, with Microsoft stating that any bond at all was completely unnecessary while Motorola argued that the bond should be equal to 100% of the value of all unsold Xbox consoles in the US. Bloody hell, that’s a lot of cash! Microsoft responded by saying that Motorola had failed to show that anyone bought an Xbox in lieu of Droids or set-top boxes, and as such a more fair bond would be 2.5% of the wholesale value of all the consoles. Of course neither company got exactly the figure they were looking for when Shaw put 7% in the recommendation, but it was certainly more in Microsoft’s favour in this instance.
Shaw’s recommendation will be going to the ITC commissioners for consideration soon, who can either let the recommendation pass, in which case it will be classed as the official determination of the ITC, or they can amend the recommendation or send it back to Shaw for further consideration. Should the ITC accept the recommendation then President Barack Obama will have 60 days to review the decision.