Earlier in June, Judge Richard Posner had thrown out cases on the issue that Motorola and Apple had brought against each other, as the patent at issue was a standard essential patent, and has to be licensed according to FRAND or fair and reasonable terms. However, both companies appealed against Posner’s decision.
Posner had also barred Motorola from seeking a ban on iPhone sales.
Google appealed the decision to the U.S. Court of Appeals for the Federal Circuit. However, the FTC made a court filing opining that Posner was correct in his ruling. In its Amicus brief for Apple, FTC said, “Patent hold-up risks harming competition, innovation, and consumers because it allows a patentee to be rewarded not based on the competitive value of its technology, but based on the infringer’s costs to switch to a non-infringing alternative when an injunction is issued.”
In the industry, standard essential patents, also termed as SEPS, have to follow fair and reasonable licensing terms because they are essential to allow devices made by different companies to work together.
The case is Apple Inc. and NeXT Software Inc. V. Motorola Inc. and Motorola Mobility Inc., in the U.S. Court of Appeals for the Federal Circuit, no. 2012-1548, 2012-1549.