July 26, 2014

Agreeing to License Standard-Essential Patents on RAND Terms May Bar Foreign Injunctive Relief

Addressing an anti-suit injunction in the context of patent licensing, the U.S. Court of Appeals for the Ninth Circuit affirmed a preliminary injunction issued by a district court temporarily enjoining the enforcement of a German patent injunction.  Microsoft Corp. v. Motorola, Inc., Case No. 12-35352 (9th Cir., Sept. 28, 2012) (Berzon, J.).

As a condition of incorporating Motorola’s patented technology into the International Telecommunications Union (ITU) H.264 video compression standard, Motorola submitted declarations to the ITU agreeing to license its patents on reasonable and non-discriminatory (RAND) terms. Motorola subsequently offered to license its H.264 standard-essential patents to Microsoft for a 2.25 percent royalty, “based on the price of the end product” and not on the component software. Microsoft filed a breach-of-contract action against Motorola in Washington. Microsoft asserted that Motorola had breached its contractual RAND obligations to the ITU by proposing unreasonable royalty rates for its H.264 standard-essential patents and that, under Washington contract law, Microsoft was entitled to enforce the agreement as a third-party beneficiary.

While the domestic litigation was pending, Motorola sued Microsoft in Germany, alleging infringement of two European patents included in its H.264 standard-essential portfolio. The German court held that Microsoft had infringed Motorola’s European patents and issued an injunction preventing Microsoft from selling its allegedly infringing products in Germany.  In district court in Washington, Microsoft sought and was granted a preliminary injunction barring Motorola from enforcing any injunctive relief it might receive in the German action. Motorola then made an interlocutory appeal to the 9th Circuit.

Employing a three-part inquiry to analyze the propriety of a foreign anti-suit injunction, the 9th Circuit panel focused on the threshold inquiry: whether or not the first action was dispositive of the action to be enjoined. Although acknowledging the territorial nature of patent law, the court found the Washington action dispositive of the German patent action because the district court had based its injunction on Microsoft’s Washington state contract claims. Specifically, because Motorola had included its European patents in its initial licensing offer, a favorable decision to Microsoft in the Washington action would preclude enforcement of the German injunction. Even if Motorola did not breach its RAND commitment, the court noted injunctive relief against infringement was a remedy arguably inconsistent with the licensing commitment.

Concluding its inquiry, the court upheld the injunction, finding no abuse of discretion in the district court’s finding that Motorola’s German action was vexatious and oppressive and that the injunction did not intolerably impact comity norms.

This article was co-written by Darryl Ong.

© 2014 McDermott Will & Emery

About the Author



Charles J. Hawkins is an associate in the law firm of McDermott Will & Emery LLP and is based in the Firm’s Washington, D.C. office.  Chuck focuses his practice on the litigation of intellectual property disputes.  He has been involved in litigation dealing with utility patent, design patent, trademark, trade secret and trade dress infringement and has handled matters at all stages of litigation, investigations involving allegations of unfair importation at the United States International Trade Commission (ITC) and including appeals to the United...


Boost: AJAX core statistics

Legal Disclaimer

You are responsible for reading, understanding and agreeing to the National Law Review's (NLR’s) and the National Law Forum LLC's  Terms of Use and Privacy Policy before using the National Law Review website. The National Law Review is a free to use, no-log in database of legal and business articles. The content and links on are intended for general information purposes only. Any legal analysis, legislative updates or other content and links should not be construed as legal or professional advice or a substitute for such advice. No attorney-client or confidential relationship is formed by the transmission of information between you and the National Law Review website or any of the law firms, attorneys or other professionals or organizations who include content on the National Law Review website. If you require legal or professional advice, kindly contact an attorney or other suitable professional advisor.  

Some states have laws and ethical rules regarding solicitation and advertisement practices by attorneys and/or other professionals. The National Law Review is not a law firm nor is  intended to be  a referral service for attorneys and/or other professionals. The NLR does not wish, nor does it intend, to solicit the business of anyone or to refer anyone to an attorney or other professional.  NLR does not answer legal questions nor will we refer you to an attorney or other professional if you request such information from us. 

Under certain state laws the following statements may be required on this website and we have included them in order to be in full compliance with these rules. The choice of a lawyer or other professional is an important decision and should not be based solely upon advertisements. Attorney Advertising Notice: Prior results do not guarantee a similar outcome. Statement in compliance with Texas Rules of Professional Conduct. Unless otherwise noted, attorneys are not certified by the Texas Board of Legal Specialization, nor can NLR attest to the accuracy of any notation of Legal Specialization or other Professional Credentials.

The National Law Review - National Law Forum LLC 4700 Gilbert Ave. Suite 47 #230 Western Springs, IL 60558  Telephone  (708) 357-3317 If you would ike to contact us via email please click here.