02/14/2013 – 653 – MINUTE ORDER – The court Grants Motorola’s request to reopen the record to submit additional evidence, by Judge James L. Robart. (MD) (Entered: 02/14/2013)

On February 12, 2013, the parties contacted the court regarding Motorola’s request to reopen the record of the November 13-19, 2012 trial to submit additional evidence. It is the court’s understanding that although Microsoft opposes reopening the trial record, in the event Motorola is permitted to submit additional evidence, Microsoft would like to submit additional evidence of its own.

Because the court desires to issue its ruling with the most complete record possible, the court GRANTS Motorola’s request to reopen the record to submit additional evidence. Microsoft may also submit contextual evidence in response to Motorola’s newly submitted evidence. The submissions of both parties shall be limited to the evidence discussed during the parties’ phone call with the court on February 12, 2013. Along with any additional evidence, both parties may submit two-page letter briefs providing the court with an explanation of the submitted evidence. Any submissions shall be filed no later than February 22, 2013.

This is about FRAND patents, with Microsoft asking the judge to set a royalty rate it owes to Motorola. The trial briefs are here, if you’d like to review the issues. Our coverage of the November trial, a bench trial, is here:

• Day 1
• Day 2
• Day 3
• Day 4
• Days 5 & 6

That was phase one of the litigation. And that’s what is now reopened. Transcripts of the trial will be made public on March 19, but until then our coverage is the best source of details on what new evidence might be about. On Day 1 and then Day 4, the parties presented opening statements.

Here’s Microsoft’s, from our reporter’s coverage of Day 1:

Microsoft’s Opening Statement:

Royalty should be proportionate to use of the patent in the relevant standards, resulting in reasonable RAND rates. Motorola is asking for unjustifiable amounts, via patent stacking. This may affect future RAND settlements. Discussed how patent pools are formed, specifics on the MPEG LA group. Purpose is to protect patents while making payments low enough to attract licensees. Motorola abruptly left the MPEG LA discussions. During those discussions, Motorola never said their patents deserved higher royalties. Professor Murphy will testify to the impact of the patent pools, supporting RAND. Matt Lind to provide data details indicating that Motorola’s royalty should be pennies, not dollars. Gary Sullivan will testify that Motorola’s contribution was only interlaced video, which was added later (and is old, unimportant technology); alternate technical solutions were available. Motorola patents are tangential to XBox, and are rarely called on in real-world use. Interlaced video support is contained in $3 to $4 chips from another company.

Motorola opening statement:

Microsoft wants low pool rates based on multilateral ex ante negotiations. This does not reflect real-world negotiations. This model does not consider strength of Motorola’s contributions. Other important patent holders rejected the MPEG LA pool. Motorola seeks to simulate a real-world negotiation that would have happened. Motorola will compare the strength of their patents vs. Microsoft patents. Multiple witnesses from multiple companies will attest to how bilateral negotiations would work.