Jury decision means Apple must pay Qualcomm $31 million

Alfred Osborne
March 17, 2019

Qualcomm Inc. won the first USA jury trial in its global dispute with Apple Inc. over how much the iPhone maker should pay for using the chipmaker's patented technology. Another deals with graphics processing and battery life.

Aside from the specifics of the outcome and the paltry $31 million payment that Apple must make-chump change for a company with Apple's resources-this case does, in fact, represent a major turning point in the two companies' legal battles because it puts a per-device dollar figure on Qualcomm's intellectual property: The three patented components represent about $1.41 per device, which Qualcomm says debunks Apple's claim that its licensing fees are too high.

A USA federal judge has issued a preliminary ruling that Qualcomm Inc owes Apple Inc almost $1 billion in patent royalty rebate payments, though the decision is unlikely to result in Qualcomm writing a check to Apple because of other developments in the dispute. Apple has sought to dismantle what it calls Qualcomm's illegal business model of both licensing patents and selling chips to phone makers.

Judge Gonzalo Curiel of the U.S. District Court for the Southern District of California on Thursday ruled that Qualcomm, the world's biggest supplier of mobile phone chips, was obligated to pay almost $1 billion in rebate payments to Apple, which for years used Qualcomm's modem chips to connect iPhones to wireless data networks.

"The technologies invented by Qualcomm and others are what made it possible for Apple to enter the market and become so successful so quickly", Don Rosenberg, Qualcomm's general counsel, said in a statement.

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Qualcomm also suffered a setback with US trade regulators who found that some iPhones infringed one of the San Diego-based company's patents but declined to bar their importation into the United States, citing the damage such a move would inflict on rival Intel Corp.

San Diego-based Qualcomm hailed the verdict as a validation of its technology's importance to iPhones.

This legal victory for Qualcomm is just the warmup from another showdown that will take place in the US next month (April 15). Separately, Qualcomm and Apple had a cooperation agreement under which Qualcomm would pay Apple a rebate on the iPhone patent payments if Apple agreed not to attack in court or with regulators.

While the damages awarded Friday aren't significant to either company, from Qualcomm's perspective, valuing just three of its more than 10,000 patents at $1.41 per phone shows the overall worth of its inventions. "This isn't something that will bring Apple to the table with any sense of urgency", Kroub said.

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