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Apple Sues Qualcomm for $1 billion

CNBC reports that Apple has sued chipset supplier Qualcomm over different patent royalties. Apple has sued Qualcomm because it owes the Cupertino-based company $1 Billion. Qualcomm responded to Apple giving information to the law enforcement that was investigating Qualcomm.

Apple is suing Qualcomm for roughly $1 billion, saying Qualcomm has been “charging royalties for technologies they have nothing to do with. […] Apple says that Qualcomm has taken “radical steps,” including withholding nearly $1 billion in payments from Apple as retaliation for responding truthfully to law enforcement agencies investigating them.

The legal proceedings against Qualcomm follow a public complaint imposed by FTC. They claim that Qualcomm used its global presence and position as a major chipset distributor of companies around the would for “onerous and anticompetitive supply and licensing terms on cell phone manufacturers.”

Apple used Qualcomm’s modems in its device until the iPhone 7 where Apple switched over to Intel and used its modems.

“For many years Qualcomm has unfairly insisted on charging royalties for technologies they have nothing to do with. The more Apple innovates with unique features such as TouchID, advanced displays, and cameras, to name just a few, the more money Qualcomm collects for no reason and the more expensive it becomes for Apple to fund these innovations. Qualcomm built its business on older, legacy, standards but reinforces its dominance through exclusionary tactics and excessive royalties. Despite being just one of over a dozen companies who contributed to basic cellular standards, Qualcomm insists on charging Apple at least five times more in payments than all the other cellular patent licensors we have agreements with combined.

To protect this business scheme Qualcomm has taken increasingly radical steps, most recently withholding nearly $1B in payments from Apple as retaliation for responding truthfully to law enforcement agencies investigating them.

Apple believes deeply in innovation and we have always been willing to pay fair and reasonable rates for patents we use. We are extremely disappointed in the way Qualcomm is conducting its business with us and unfortunately after years of disagreement over what constitutes a fair and reasonable royalty we have no choice left but to turn to the courts.”

-Apple’s statement regarding the lawsuit against Qualcomm

Qualcomm replied to this after a day and said that Apple’s claims are baseless and Apple intentionally mischaracterized the agreements and terms between the companies.

While we are still in the process of reviewing the complaint in detail, it is quite clear that Apple’s claims are baseless. Apple has intentionally mischaracterized our agreements and negotiations, as well as the enormity and value of the technology we have invented, contributed and shared with all mobile device makers through our licensing program. Apple has been actively encouraging regulatory attacks on Qualcomm’s business in various jurisdictions around the world, as reflected in the recent KFTC decision and FTC complaint, by misrepresenting facts and withholding information. We welcome the opportunity to have these meritless claims heard in court where we will be entitled to full discovery of Apple’s practices and a robust examination of the merits.

Don Rosenberg, executive vice president, and general counsel, Qualcomm Incorporated.

[Soruce(s): CNBC, Qualcomm]

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