Apple Gives Us Another Reminder Why Google Wants Motorola

Remember the recent reminder of why Google (Nasdaq: GOOG  ) wants to buy Motorola Mobility (NYSE: MMI  ) ? Hint: It's not Motorola's actual business. That's right -- its patents!

Well, here's more evidence reaffirming that rationale: Back in December, Motorola was granted a preliminary injunction in Germany against Apple (Nasdaq: AAPL  ) that had the potential to block Cupertino's 3G-enabled devices. The key word was "potential" since the overall impact was yet to be seen … until today.

A regional German court reaffirmed that initial decision by issuing a sales injunction against European sales subsidiary Apple Sales International, forcing Apple to remove all 3G-enabled devices other than the current iPhone 4S from its Online Store, including the older iPhone 3GS and four models of 3G iPads. The 4S wasn't covered in the initial complaint, but Motorola quickly addressed that with a new filing stateside.

The patent ruling concerned iCloud and push services, prompting Apple spokesman Alan Hely to comment, "Apple believes this old pager patent is invalid and we're appealing the court's decision." Hely also pointed out that the ban covered only Apple's Online Store, and that prospective buyers shouldn't have any troubles finding devices locally at Apple Retail Stores or through an authorized reseller.

In an almost-immediate turn of events, Apple was able to score a suspension of the injunction, with online availability returning "shortly," since Apple claims that Motorola "repeatedly refuses to license this patent to Apple on reasonable terms, despite having declared it an industry-standard patent seven years ago."

Under FRAND -- or "fair, reasonable, and non-discriminatory" -- terms, companies that own industry standard and essential patents are required to license them for the sake of competition. Apple's assertion that Motorola isn't playing fair could land Motorola in hot water with the European Commission, joining fellow Apple foe Samsung.

Bringing it all home is the fact that Motorola also recently won another International Trade Commission ruling in a defense against Apple shortly after similarly holding its own against Microsoft's (Nasdaq: MSFT  ) Android bullying.

It looks like Motorola's patent portfolio might actually be worth $12.5 billion after all.

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Fool contributor Evan Niu owns shares of Apple, but he holds no other position in any company mentioned. Click here to see his holdings and a short bio. 

The Motley Fool owns shares of Apple, Microsoft, and Google. Motley Fool newsletter services have recommended buying shares of Apple, Microsoft, and Google. Motley Fool newsletter services have recommended creating a bull call spread position in Microsoft. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 04, 2012, at 12:31 AM, vulcan747 wrote:

    Your argument falls flat with the inclusion of the highly respected Judge Posner's powerful opinion mentioned by Dana Blakenhorn published on Seeking Alpha

    "In the U.S. things are going Apple's way. Judge Richard Posner, who is hearing the Apple-Motorola complaints that could control other actions against Android, has agreed with Apple's interpretation of the '949 touchscreen heuristics patent as protecting an "API that allows real-time interaction between two or more subsystems" but overall wants to try fewer patents. Apple is now bringing this view into court against other Android makers and it's hard to see how it could be invented around if upheld."

    Judge Posner is the most highly respected judge in these matters and his opinion is unlikely to be overturned.

    Apple legal is popping champaign corks over this

    important '949 patent finding. Google is picking up multiple sonar signatures at 15000 meters: 4 high speed props running 5 degree separation at 2 fathoms!

    http://seekingalpha.com/article/340861-why-apple-stock-float...

  • Report this Comment On February 04, 2012, at 9:55 PM, Edeskimo wrote:

    All these patent troll suits are ridiculous and gumming up the courts. It also stifles innovation.

    RIM many years ago was forced to pay out a large settlement because some guy filed a patent about the ability to send email wirelessly. He had no working device, just an idea that he could not execute.

    In the end I think much of these software suits are just ridiculous and should be tossed out. Just tell the companies to compete on what they can produce for the consumer.

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