Here we go again. Hot off the news of the ITC’s decision in favor of Apple in its case against HTC, the ITC has announced a preliminary ruling in Microsoft’s patent infringement case against Motorola. The preliminary judgment indicates that Motorola’s Android devices do infringe on Microsoft’s patent (#6,370,566) which entails “a mobile device which provides the user with the ability to schedule a meeting request from the mobile device itself.” Fortunately for Motorola, the initial ruling by the administrative judge will still need to be reviewed by the entire ITC panel before any final decisions are made on the case.

Rulings like these are typically bad news for Android OEMs, but Motorola appears to be very happy about the ruling. In its official press release, Motorola focuses more on the fact that the administrative judge threw out the six other patents that Microsoft claimed Motorola was in violation of. Motorola also pointed out that they are still pursuing legal action against Microsoft on multiple fronts in an effort to protect its intellectual property.

Unlike Apple, Microsoft has been negotiating licensing agreements with Android OEMs which will allow them to use their patent without fear of being sued. Since Microsoft is a little more reasonable than Apple, the worst that could happen is that Motorola will need to license the patent in question from Microsoft. As of now, Motorola has been the only OEM to challenge Microsoft’s IP claims over Android, but now that Motorola has somewhat of a leg up, other OEM’s could follow suit and use the ITC’s findings on the other six patents to regenerate their current licensing fees.

Do you see the ITC’s preliminary ruling in this case as a bad outcome for Motorola or is it a positive step for them and other OEMs which will allow them to keep a little more cash out of Microsoft’s wallet?

Show Press Release

Initial Determination from ITC Finds That Motorola Mobility Did Not Violate Six of the Seven Patents

Dec. 20, 2011

LIBERTYVILLE, Ill. – Dec. 20, 2011 – Motorola Mobility Holdings, Inc. (NYSE: MMI) (“Motorola Mobility”) today announced that it has received notice that the Administrative Law Judge (“ALJ”) in the U.S. International Trade Commission (“ITC”) action brought by Microsoft (NASDAQ: MSFT) against Motorola Mobility has issued an initial determination. The ALJ determined that Motorola Mobility does not violate six of the seven Microsoft patents listed in Microsoft’s suit. The Company noted that Microsoft had previously dropped two patents from its original case which included nine patents.

“We are very pleased that the majority of the rulings were favorable to Motorola Mobility,” said Scott Offer, senior vice president and general counsel of Motorola Mobility. “The ALJ’s initial determination may provide clarity on the definition of the Microsoft 566 patent for which a violation was found and will help us avoid infringement of this patent in the U.S. market.”

Microsoft continues to infringe Motorola Mobility’s substantial patent portfolio and Motorola Mobility has active patent infringement litigation and proceedings against Microsoft in a number of jurisdictions, including the ITC. Motorola Mobility remains confident in its position and will continue to move forward with its complaints.

The ALJ’s initial determination is subject to further review by the ITC. The final decision in this case, based on the deliberation of the full ITC, is expected by April 20, 2012. The ITC’s final determination ruling would be subject to a 60-day review period by U.S. President Obama. The Company noted that sales outside the U.S. are not within the focus of the ITC.

Business Risks

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include, but are not limited to, statements about the impact of this litigation and future actions with respect to this litigation. Forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements, including but not limited to the successful defense of the claims by Microsoft and protection of the company’s intellectual property; the timing of the matters before the ITC; the company’s continued ability to sell its mobile device products; and the other risks and uncertainties contained and identified in Motorola Mobility’s filings with the Securities and Exchange Commission (the “SEC”), any of which could cause actual results to differ materially from the forward-looking statements. The forward-looking statements included in this press release are made only as of the date hereof Motorola Mobility does not undertake any obligation to update the forward-looking statements to reflect subsequent events or circumstances or update the reasons that actual results could differ materially from those anticipated in forward-looking statements, except as required by law.

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