Thursday, February 9, 2012

Two more huge loopholes identified in Google FRAND letter to standards bodies

This is a follow-up to yesterday's rapid commentary on Google's letter to standard-setting organizations concerning the use of Motorola Mobility's essential patents.

Today I re-read the letter and thought about it some more. There's no shortage of loopholes in it, and I addressed some of them yesterday, but I found two more that appear to be particularly important:

  1. The version of the Google letter that I published went to IEEE, an American standard-setting organization. A key IEEE standard in connection with which Motorola Mobility is seeking injunctions is 802.11 (WiFi, or WLAN). But there are various other standards (such as H.264, GPRS and UMTS) at issue in MMI's litigations. I saw a report according to which Google sent its letter to multiple standard-setting organizations.

    The issue here is that Google's letter does not say that the maximum royalty rate of 2.25% applies to all standards from all standard-setting organizations. Otherwise they could ask for 2.25% on WiFi/WLAN, 2.25% on UMTS, 2.25% on H.264, etc.

    The way I read Google's letter, the 2.25% cap (which is totally excessive anyway) can at the most be interpreted to apply to all standards of one particular standard-setting organization (whichever receives an individualized version of the letter).

  2. I can't help but wonder why Google's letter relates to only Motorola Mobility's patents. Why doesn't Google include all of its patents, regardless of whether it applied for them in its own name, intends to buy them through the acquisition of MMI, or bought or will buy them from other entities?

    This is a reasonable question to ask given that Apple's and Microsoft's statements (and Cisco's endorsement of Apple's letter to ETSI) are clearly not limited to any subset of their patent portfolios.

    Google buys patents all the time. For example, it bought more than 2,000 patents from IBM in 2011, and acquired various smaller entities that hold patents. It should have a consistent FRAND policy with respect to all of them.

Something worth doing is worth doing right. We're talking about a document that spans over four pages and was undoubtedly written by legal professionals who know how to properly craft such documents.

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