Motorola won the first of two patent-infringement cases against Apple’s European sales division based in Ireland, granting Motorola an injunction against all of the infringing products in Europe.
The number of products covered by the suit is downright staggering. This is a major blow to Apple and a perfect example of patent war blowback. A quick rundown of the products Apple can no longer sell in Germany:
- iPhone 3G
- iPhone 3GS
- iPhone 4
- iPad 3G
- iPad 2 3G
Motorola filed the suit back in April, which is likely the only reason the iPhone 4S is not included in the injunction. The patent covered in question is described as a “method for performing a countdown function during a mobile-originated transfer for a packet radio system.” Apple previously raised a FRAND defense in the United States case over the same patent and the patent was declared essential to the General Packet Radio Service standard.
However, German courts are less accepting of FRAND defenses when considering previous infringement, and in the case of this patent, Motorola is looking for payment greater than the FRAND rate, from 2007 on. Even if Apple and Motorola do come to a FRAND agreement, Apple could be on the hook for billions in unpaid licensing fees. Apple will of course appeal the decision.
Motorola can still decide to enforce the ban even if Apple appeals, but they must put forward $134 million bond if they want to enact the ban. This is done in case the verdict granting Motorola the injunction is overturned, in which case the bond money will be given to Apple as reparations for lost revenue because of the bond. Apple wanted the bond to be set at $2.7 billion, but the courts sided with Motorola’s much cheaper claim. Previous rulings in Motorola's favor didn't allow an actual preliminary injunction to be invoked, but this one does.
The German courts and the precedent their previous FRAND rulings establish do not paint a pretty picture for Apple. Unless Apple settles with Motorola out of court and strikes up a FRAND agreement—not likely to be Apple friendly—a number of Apple products will not be available in Germany and ther rest of Europe if Motorola goes ahead with the injunction.