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Microsoft Says Motorola Mobility Blocks Sales in Complaint Filed With EU

Microsoft Corp. (MSFT) filed a complaint with European antitrust regulators saying Motorola Mobility Holdings Inc. (MMI) and Google Inc. (GOOG) are trying to block sales of personal computers and game consoles that run its software.

Motorola Mobility is violating a pledge to license industry-standard patents on fair terms and “demanding that Microsoft take its products off the market,” Microsoft said in a blog post. Apple Inc. (AAPL) has also filed a complaint to the European Union over Motorola Mobility’s licensing terms.

“We have taken this step because Motorola is attempting to block sales of Windows PCs, our Xbox game console and other products,” Microsoft said. Legal actions by Motorola Mobility to enforce its patents may “kill” video-streaming services on the Internet, Microsoft said.

Motorola Mobility, Microsoft, Samsung Electronics Co. and Apple are involved in numerous patent lawsuits in Europe as demand for smartphones and tablets soar. Google, which is buying Libertyville, Illinois-based Motorola Mobility for $12.5 billion, has written to groups that establish industry standards to assure them it will license Motorola Mobility patents on a fair and reasonable basis.

‘Step Back’

“Watching video on the Web is one of the primary uses of computers these days,” Microsoft said in its statement. “Imagine what a step back it would be if we could no longer watch videos on our computing devices or connect via Wi-Fi, or if only some products, but not others, had these capabilities,” it said.

“We are yet to receive a copy of the complaint, but Motorola is committed to vigorously defending its intellectual property,” Gemma Goatly, a spokeswoman for Motorola Mobility, said in an e-mail.

Microsoft’s complaint also covers Google because the firm hasn’t committed to changing Motorola Mobility’s policy, the Redmond, Washington-based company said.

“Microsoft’s complaint is just another example of their attempts to use the regulatory process to attack competitors,” Niki Fenwick, a spokesperson for Google, said in an e-mailed statement. “It’s particularly ironic given their track record in this area and collaboration with patent trolls.”

The European Commission has “received this complaint and we will examine it,” Antoine Colombani, a spokesman for EU antitrust chief Joaquin Almunia, said in an e-mail. Samsung is already being investigated by EU antitrust regulators over whether it broke licensing commitments.

‘Playground Monitor’

“The European Commission is a little bit, in this context, like the playground monitor when it comes to U.S. technology companies,” said Andrew Updegrove, a lawyer with Gesmer Updegrove LLP in Boston who advises standard-setting boards on intellectual property policies.

“It’s really a kind of scuffle where everyone tries to bend the ear of the European Commission to make life uncomfortable for their rivals,” Updegrove said.

Motorola Mobility also has filed complaints against Apple and Microsoft at the U.S. International Trade Commission in Washington, to block imports of Apple’s iPhone and Microsoft’s xBox into the U.S. Apple and Microsoft have argued that the agency shouldn’t issue exclusion orders when the patents are essential to industry standards.

Both Microsoft and Apple have said they wouldn’t seek a court order to block use of technology covered by industry- standard patents even as they pursue infringement claims over non-essential patents against Motorola Mobility.

Google has said it would seek a royalty fee of no more than 2.25 percent of the net cost of devices using its patents, and would try to resolve any disputes through negotiation before asking courts to block use of the Motorola Mobility technology.

“We are aware of the increasingly strategic use of patents in the sector and are vigilant,” the EU’s Almunia said Feb. 13. “We can avoid a continuation of this patent war.”

To contact the reporters on this story: Jim Brunsden in Brussels at jbrunsden@bloomberg.net; Susan Decker in Washington at sdecker1@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net Michael Shepard at mshepard7@bloomberg.net

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