Motorola's Germany Xbox sales ban castrated by US judges

Motorola is not allowed to stop Microsoft Xboxes from being sold in Germany after a US appeals court agreed that the sales ban was too narrow. A court in Seattle prevented Google-owned Motorola from enforcing an injunction against the games console, and a three-judge panel at the appeals court has agreed with that decision. …

[Ben Tasker]

It is because of the initial suit being filed on US soil, and the fact that it relates to two American companies, that the Seattle court was able to intervene in the matter of the Germany ban

Whilst I can see the logic, it strikes me as stretching it to say that a US court has the power to overrule the decision of a court in another nation?

You could argue it's a case of the US Courts trying to keep their own house in order, of course, but if a German court has said "Can't be sold here" what right does the US have to say "Yeah they can"?

Or is it because Motorola would have to seek to enforce the injunction that they feel they can? After all, from that view I suppose they're not actually dealing with the German decision, more saying to Moto "You may have got the decision, but we're telling you you can't use it?"

All seems a little extra-territorial to me!

[Anonymous Coward]

The judgement is here ...

http://www.ca9.uscourts.gov/datastore/opinions/2012/09/28/1235352.pdf

In a nutshell, they aren't attempting to overrule the German court. They are saying that Motorola can't use the German verdict to get around an agreement made in the US.

Can the US court do this? See the next round's verdict

[vagabondo]

Re: The judgement is here ...

> They are saying that Motorola can't use the German verdict to get around an agreement made in the US.

But from my reading of Groklaw it seems that Motorola's main complaint is that Microsoft refuses to even enter negotiations towards an agreement in Germany or the USA.

[cloudgazer]

Re: The judgement is here ...

ALJ Shaw determined that “the evidence supports Microsoft’s conclusion that Motorola was not interested in good faith negotiations and in extending a RAND license to it.”

http://www.itcblog.com/20120524/alj-shaw-issues-public-version-of-initial-determination-finding-a-violation-of-section-337-by-microsoft-in-certain-gaming-and-entertainment-consoles-337-ta-752/

[Ben Tasker]

Re: The judgement is here ...

But the point, surely, is that only a German court has the right to decide what the US court has taken it upon itself to decide. Germany being one of the many many countries not subject to US law.

After all, there's bound to be a few things where the legality differs whether youre in the US or the UK. The US has no jurisdiction here, so how is this different?

[Beachrider]

CA9 is not trying to overrule a German court...

This is a little messy. It is about a flotilla of patents for H.264.

In the USA, Motorola agreed to license H.264 IP on a royalty basis. Motorola had previously been taken to high-courts in the USA to establish reasonable royalty 'terms' with other vendors (Apple). This IP is valid in 15 countries (including Germany) + the Euro Patent Convention.

MSFT didn't accept Motorola's offer. Motorola thought it was reasonable. They went ahead on positioning XBOX and Windows software in Germany, without an agreement.

Motorola filed suit in the USA. The court ruled that Motorola DID NOT break its high-court agreement to offer reasonable royalty terms. MSFT disagreed and appealed this in the USA.

Motorola THEN went to a German court to gain an injunction against Microsoft, on the IP violation.

If they won, Motorola would have to post a bond that would go to MSFT, in case the German court is overturned. Uniquely, German courts allow MSFT two things:

1) to unilaterally request a judge for binding arbitration

2) to establish the size of the bond. MSFT set this at $300Mn

In the meantime, MSFT's appeal was key. MSFT claimed that the German suit couldn't be applied if the royalty was unreasonable. MSFT got that judgement in the USA, but MSFT had to file a $100Mn bond, in case the USA judgement got overturned. This all happened before the German judgement came through on May 2.

The German court ruled for Motorola on the IP violation, but said nothing about the royalties. MSFT hasn't requested German arbitration, either. Motorola appealed the USA finding on royalties.

The USA court feels that it has control over the royalties issue. MSFT has paid its bond in the USA. Motorola is not enforcing its German finding, but isn't paying its bond, yet. MSFT is selling XBOX and software in Germany in open defiance of its lost patent-suit. Motorola isn't enforcing its injunction, until the issue of a fair royalty is resolved in the USA.

Once Motorola puts a number before the USA courts that is considered reasonable, they will get the $100 Million in the USA. They will also back-collect on items sold in Germany. MSFT just didn't want to turn that number-setting over to a German court.

Whew!

[tkioz]

Yeah this is going to go down well in Deutschland...

[Beachrider]

The Reg has tried to bumper-sticker the issue...

US courts cannot override German courts on issues of German law. HTG, how are any of you believing that THAT could happen.

US courts ruled that two American companies are enjoined on setting a reasonable royalty. Since they don't thing that the two companies have done that, they told Motorola to stop the bond-posting that would being enforcement of the German judgement. Motorola has complied.

No German courts have been ignored here. An American company simply has declined to file the bond that begins the enforcement of the German judgement.

[Dave 15]

Would like to see

I would love to see the Germans turning around and telling the US court to sod off, the ban should stay. In fact the EU should gather round and back up the Germans in this case and make the ban EU wide. And if the US court doesn't back down then make it a ban on all American imports. IT is time the US backed their nose out of other peoples countries (ALL of them). I don't care whether or not the Germans made the right judgment in this case - but it was THEIR judgment in THEIR country and NOTHING AT ALL to do with ANY American court

[Someone Else]

As an Amurikin...

...I upvoted your post.

[Fatman]

Re: As an Amurikin...

I must heartily agree.

Someone (the US courts) have gone too far.

Perhaps the German courts could demand the extradition of the judges involved in the US case; and try them for contempt.

[Big_Ted]

So the US are saying that.....

they have the right to enforce their laws and court decisions on us in the EU etc ?

Well I say sod off to them, how dare a district court in the US that can't enforce all its decisions inside the US due to different state laws think it has the right to dictate to another country.

I say the EU should set its diplomats on the US government and get them to get the US attorney general to tell this court to stop making themselves look like they think they run the world.

And why would they have the right to tell Motorola where they can sue MS even if a case has already been started, I don't remember Apples favortie judge telling them they had to stop all other actions against Samsung world wide as they were already in court in the US.....

[Scott 1]

Re: So the US are saying that.....

"Well I say sod off to them, how dare a district court in the US that can't enforce all its decisions inside the US due to different state laws think it has the right to dictate to another country."

The district courts are Federal courts, and Federal law trumps state law. The idea that federal court filings can't be enforced due to state laws is false.

[ukgnome]

How long before the german court tries to sue the american court?

My monies is on apple filing a patent on the process of suing a foreign court so they can counter sue both.

[Dazed and Confused]

@How long before the german court tries to sue the american court?

Why bother, just declare the US judges to be in contempt of court. If the poor fools ever make the mistake of landing in the EU they could then find themselves subject to a European arrest warrant and having their arse haulled in front of the German beaks to explain themselves.

[Fibbles]

Perhaps we could invent some sort of faux rape case in an attempt to lure the American judges to Sweden so that they can defend themselves. The Germans could then issue a European arrest warrant. Unfortunately for the Americans, unbeknownst to them, the Germans convened their equivalent of a secret grand jury and declared the judges 'enemies of the state' for trying to subvert German justice.

[Fatman]

RE: could invent some sort of faux rape case

Damn You!!!!

I ruined my keyboard!!!!! (Spitting orange juice over one after reading your comment.)

</sarcasm>

[mark l 2]

I'm sure the register gets paid everytime they mention Windows 8, the author of this article managed to shoe horn it in even though it had absolutely no relevance to the subject other than it being produced by Microsoft, why not mention Office and Hotmail as well just for good measure.

[Dazed and Confused]

@why not mention Office and Hotmail as well just for good measure.

Because this week M$ are only paying marketing $$$ for mentions of Windows8

[Pat 4]

In other news...

Germany gives the US court a middle finger salute...