Apparently Microsoft is in deep with Motorola, following an infringement investigation on components of their own work. It looks like Microsoft may be in trouble, as the Xbox 360 S consoles very well could be banned from sales in the United States.

Judge David Shaw, of the International Trade Commission, has recommended the ban/block of all imports of the 4GB and 250GB Xbox 360 Slim consoles in the United States. According to the Courthouse News Service, Microsoft will need to post a bond equal to 7 percent of the declared value of unsold Xbox inventory already in the country.

The legal conflict here is that Microsoft had infringed on four Motorola patents related to secure wireless communication and transmission of video content between controller devices and game consoles. In other words, video decoding (think of it like programming that the computer does for you) and Wi-Fi Connection items. The video content was patented by Motorola, Microsoft simply utilized it when building their systems. Motorola filed its initial complaint with the Trade Commission in November 2010.

This whole thing is based on a cease-and-desist order, meaning though we may not see sales of the console for some time, it can still be brought back later. However – and this was Microsoft’s main argument – sales of the console will drop considerably and the competition (PS3, Wii) will see much more business from the consumer. David Shaw and some of the commissioners disagree, but realistically Microsoft won’t want this to happen, for any of several good reasons, but mainly – it’s bad for business.
The ITC can adopt the determination, amend it or send it back for further consideration. While no ban is in place just yet, the International Trade Commission is expected to conclude the investigation in August. But, only time will tell.