Apple Inc. (NASDAQ:AAPL) and Motorola Mobility Holdings Inc (NYSE:MMI) appear to have reached a settlement relating to the standards-essential patents, owned by the latter, with the licensing deal said to operate in Germany only. Accordingly, Apple Inc. (NASDAQ:AAPL) must now pay a royalty on FRAND terms (fair, reasonable and non-discriminatory) to Motorola Mobility Holdings Inc (NYSE:MMI), with the rate of royalty to be decided by German courts, unless the two companies agree on it before that. Apple will pay a royalty on products sold in Germany only, according to the report in CNET, which credits Foss Patents for the revelation of the agreement.

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The two companies had been fueding over these patents – Motorola’s beef was that Apple had infringed these patents, whereas Apple complained that Motorola was being usurious by demanding a very high royalty, which was not FRAND, for these patents.

The deal complicates matters somewhat for Motorola’s other patent battles with Apple, which continue to run the course – here Motorola would have to take recourse to non-standard-essential patents only. Motorola probably entered the deal for fear of being open to anti-trust claims from Apple, for refusing to entertain its offers to license those patents, as required by German law. Secondly, Motorola is also facing heat from EU authorities about its alleged abuse of standards-essential patents against both Apple and Microsoft Corporation (NASDAQ:MSFT).

Google Inc (NASDAQ:GOOG) is reported to be going through its patent holdings with a fine tooth comb to determine which ones it might use against Apple.

Outside Germany the two companies are still embroiled in patent battles, and Motorola filed yet another suit against Apple earlier this month that sought to ban imports of some hot-selling products of Apple Inc. (NASDAQ:AAPL), that were made overseas and imported into the U.S., such as the iPad, Touch, and iPhone. Patent experts view this as a strong-arming move, designed to get Apple to settle disputes.