The patent battle between Microsoft and Motorola has hit another interesting bump in the road, with administrative Judge David Shaw saying that sales of the Xbox 360 should be banned in the U.S. “Sale of machines should be prevented with a cease-and-desist order and Microsoft should post a bond equal to 7% of the declared value of unsold Xbox 360 inventory that is already in the country,” said Shaw.

Microsoft countered that 7% was far too high and suggested 2.5%. Motorola told the Judge that Microsoft should have to pay 100%. Microsoft also told Judge Shaw that the order does not serve the public interest, as it unfairly forces consumers to choose between the PlayStation 3 and Wii for their gaming console. Shaw rejected the argument, suggesting that Sony and Nintendo could keep up and would welcome the increased demand.

The ruling comes from Shaw’s determination in April that we told you about, where he ruled that Microsoft had infringed on four of Motorola’s patents that were related to wireless and transmission of video content. Microsoft has recently received a ruling that says that Motorola has infringed on one of Microsoft’s patents.

If Shaw’s determination and ruling become final, the entire thing will be left up to President Obama, who will have 60 days to review the matter and decide if it should be reversed. If Motorola is successful, it could have a large impact on Microsoft’s bottom line if they are unable to sell consoles this holiday season.