Qualcomm, the world’s dominant supplier of baseband processors, is seeking an injunction requiring Apple’s contract manufacturers to pay royalties owed. The company says Apple is encouraging the non-payments as a way to shut down other pending legal actions.
Qualcomm received an FTC complaint in January for allegedly threatening Apple with higher royalty payments if Apple tried to get baseband chips from other companies. Apple responded with a $1 billion lawsuit in the U.S., a $140 million lawsuit in China, and a third in the United Kingdom.
Qualcomm countersued Apple, and then recently added a lawsuit against the contract manufacturers FIH Mobile, Hon Hai Precision, Pegatron, Wistron and Compal Electronics.
In a statement regarding Apple’s lawsuit, Qualcomm said: “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.”
However, Apple has this to say: “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.”
Apple further alleges Qualcomm has withheld $1 billion in payments as retaliatory measure “for responding truthfully” to law enforcement agency investigation into the company.
