Back in January, Apple filed a surprising billion dollar lawsuit against American chipmaker Qualcomm for charging them unfairly for the patents they had nothing to do with. The said claims followed pursuit to couple other charges for unfair trade practices across the globe — in China and South Korea. It has then called out Apple for mischaracterising their agreements and negotiations, thus, terming the claims as baseless.
Today, Qualcomm has officially fired back at Apple with a lawsuit of its own, where it is seeking damages from the Cupertino giant for wrongly accusing it of unfair trade practices, harming its business and breaching their long-running contract. The chipmaker detailed the value of its technologies, innovations and licensing program which has enabled others in the industry to fairly employ the same in their devices.
As per Apple’s accusations, Qualcomm was using its leading position in the silicon and cellular technology business to charge inflated patent royalties from its industry partners. The Cupertino giant stated that the chipmaker was essentially ripping off hardware makers by even charging them for patents they weren’t employing in their devices — such as the modem chips from its rivals. It further named TouchID, display panels, and cameras as a couple of components where Qualcomm was charging unnecessarily and making licensing more expensive.
But after a 3-month long wait, Qualcomm has now finally hit back with its own answers and counterclaims asserting that its licensing model is consistent with laws across the globe. It further adds that the same has been accepted by other manufacturers in the industry for several decades and Apple tried to hamper their relations (and business) with their allegations. It states that Apple also intervened with Qualcomm’s relation with licensees (maybe..Foxconn!?) that manufacture iPhones, iPads and other smartphones using licensed chips from them.
In the official press statement, Don Rosenberg, Qualcomm’s executive VP and general counsel said:
Over the last ten years, Apple has played a significant role in bringing the benefits of mobile technology to consumers with its popular products and services. But Apple could not have built the incredible iPhone franchise that has made it the most profitable company in the world, capturing over 90 percent of smartphone profits, without relying upon Qualcomm’s fundamental cellular technologies.
Now, after a decade of historic growth, Apple refuses to acknowledge the well established and continuing value of those technologies.
Further, Qualcomm doesn’t just stop there. It further claims that Apple had ‘breached agreements and mischaracterized agreements and negotiations’ with them. Apple was wrongly advertising the performance disparity between an iPhone using Qualcomm modems and third-party competitor modems but truth is that Cupertino chose not to utilize the full performance of Qualcomm’s modem chips in its iPhone 7 lineup. Also, the chipmaker alleges Apple threatened it not to make any comparisons about the superior performance of Qualcomm-powered iPhones.
Further, Rosenberg continues to blaze against Apple saying:
It has launched a global attack on Qualcomm and is attempting to use its enormous market power to coerce unfair and unreasonable license terms from Qualcomm. We intend to vigorously defend our business model, and pursue our right to protect and receive fair value for our technological contributions to the industry.
Qualcomm has recently been plagued with numerous legal challenges on an international scale. Apple’s allegations further fanned the burning fire and attempted to disrupt the chipmaker’s primary source of income. After the hefty billion dollar lawsuit, Apple also filed a lawsuit in an intellectual property court in Beijing, seeking damages of 1 billion Yuan (approx $146 million) for violating their patent rights. Apple CEO Tim Cook had the following to say when the lawsuit was filed:
You should take from our filing that we viewed it as, we didn’t see another way forward. Qualcomm was insisting on charging royalties for technologies that they had nothing to do with.
And the Federal Trade Commission (FTC) had also pointed fingers at the chipmaker indulging in practices that weren’t entirely fair and using its dominant position in the market to stifle competition. The Korean FTC has recently also cracked down on Qualcomm for barring Samsung from selling its in-house Exynos chips to third-party smartphone makers. But, the allegations have been denied by the chipmaker, who termed all of those as baseless.
