Skyhook Wireless developers technologies that rely on cell towers, WiFi access points and GPS to determine the location of cell phones and similar devices within 20-30 metres accuracy. Google offers similar functionality through Google Maps and Google Latitude, which it of course also integrates into Android.
And therein lies the problem. Skyhook claims that Motorola was supposed to use Skyhook's XPS location technology starting April this year in its Android-based smartphones. When Google's Android boss Andy Rubin got wind of this, he contacted Motorola's co-CEO Sanjay Jha and issued a 'stop-ship' order for Motorola Android devices using Skyhook's technologies, claiming that using Skyhook's software would make the devices incompatible. These are all claims by Skyhook, of course.
"As none of these devices was preloaded with XPS software, as would have occurred but for Google's interference, Skyhook lost millions of dollars in royalties provided under the Motorola Contract," Skyhook claims. Skyhook claims that another unnamed company, believed to be Samsung, received a similar stop-ship order from Rubin.
In the patent infringement lawsuit, Skyhook claims Google violated four of its patents relating to location services. All this stuff is quite important to Skyhook, since the company already lost Apple as one of its customers, since Cupertino created its own rivalling technology.
I guess the key here is whether or not the stop-ship order thing is true, and on what it is based. I wouldn't think Google has a monopoly in the device location determination market (nicely made up, huh?) or the smartphone business, so this could just as well be a simple case of competition.
Then again, Google is just a company, and it's just as likely they have actually broken laws by pressuring Motorola into ditching Skyhook. We'll have to wait and see.