ITC judge recommends import ban on Microsoft’s Xbox

An administrative law judge for the International Trade Commission issued a recommendation that the commission ban 4GB and 250 GB Xbox gaming consoles from import to the United States. The recommendation (PDF) was released to the public on Monday, and would punish Microsoft for infringing against some of Motorola’s patents. The patents permit video transmission and compression on the console and between the console and its controllers.

Not all import bans are created equal though. In Judge David Shaw’s statement, he suggested a cease and desist order be placed against Microsoft. It would, "require the respondent to submit an annual report to the Commission regarding the number and value of infringing goods in its domestic inventory," according to the authors of ITC Remedial Orders in the Real World (PDF). "Failing to do so, or providing false information in the report, may lead to criminal prosecution under 18 U.S.C. § 1001." The cease-and-desist order is more strict than a standard exclusion order, which would simply require US customs agents to keep tabs on Microsoft’s activities.

Judge Shaw also ordered "that Microsoft post a bond equal to 7 percent of the declared value of unsold Xbox inventory already in the country," according to Courthouse News.

Motorola’s complaint against Microsoft with the ITC dates back to 2010. In this particular case, Microsoft argued that an import ban would adversely affect consumer choice. After all, without the Xbox, only Sony’s Playstation and Nintendo’s Wii will be available. Judge Shaw explained in his statement that he believes Microsoft’s patent infringement is more detrimental to the public interest than the lack of Microsoft as a competitor in the game console market.

Microsoft and Motorola have been tangled in patent disputes for years. Motorola most recently won an injunction against Microsoft's Xbox 360 in Germany only to have a judge in Seattle overturn it.

From here, Judge Shaw’s recommendation against Microsoft will go to the ITC’s board of commissioners. They’ll have the opportunity to either let the recommendation stay, or to overturn it. If they allow the recommendation to stand, it will be sent to the President’s desk where he’ll have 60 days to review and sign it.