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Qualcomm Countersues Apple, Says iPhone Wouldn't Be Possible Without its Technologies

Qualcomm today announced it has countersued Apple [PDF] in the U.S. District Court for the Southern District of California, nearly three months after the iPhone maker sued the chipmaker for $1 billion in alleged unpaid royalty rebates. Apple also accused Qualcomm of engaging in anticompetitive licensing practices.

Qualcomm, which earlier called Apple’s lawsuit “baseless,” officially denied the majority of Apple’s allegations and accused the Cupertino-based company of failing to engage in good faith negotiations for a license to its 3G and 4G standard essential patents on fair, reasonable, and non-discriminatory terms.

The chipmaker also accused Apple of breaching its licensing agreements, making false statements, and encouraging regulatory attacks on its business in multiple countries. Qualcomm added that Apple has deliberately “chose not to utilize the full performance” of its LTE modem in its iPhone 7 and iPhone 7 Plus.

Even still, independent testing last year found Qualcomm’s LTE chip to significantly outperform Intel’s LTE chip in iPhone 7 models.

However, Qualcomm said Apple misrepresented the performance disparity between iPhones using its modems and those using competitor-supplied modems. Qualcomm said Apple made threats to prevent it from making any public comparisons about the superior performance of the Qualcomm-powered iPhones.

Qualcomm, a longtime supplier of 3G and LTE modems for iPhones, said Apple has “launched a global attack” against its company, using its “enormous market power” to coerce unfair and unreasonable licensing terms.

Qualcomm said Apple “could not have built the incredible iPhone franchise” without relying upon Qualcomm’s “fundamental cellular technologies,” adding that Apple “refuses to acknowledge the well established and continue value of those technologies” after a decade of unprecedented growth.

“Qualcomm is the world leader in inventing and developing fundamental, ground-breaking mobile technologies that enable the worldwide mobile ecosystem. Today, Qualcomm’s patented technologies remain the primary value driver for mobile devices,” said Don Rosenberg, executive vice president and general counsel of Qualcomm. “The value of our inventions has been proven through hundreds of license agreements, negotiated and renegotiated over almost three decades, with virtually every significant handset maker in history, including the companies in Asia that have manufactured Apple iPhones and iPads. 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. 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 is seeking, among other things, both compensatory and punitive damages from Apple in amounts to be proven at trial for “reneging on its promises in several agreements.” It is also seeking to be released from any obligation to make further payments to Apple.

Tag: Qualcomm

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