Apple settles with Qualcomm outside of court
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Ever since 2017, Apple and its primary modem chip supplier Qualcomm have been dealing with some severe falling-outs. First, Apple had accused Qualcomm of charging it unfairly high prices compared to other competitors.
Then after Apple had diversified its partnerships with other modem suppliers to curtail its sole reliance on Qualcomm, the chipmaker, in turn, launched multiple lawsuits against Apple, alleging that it was stealing trade secrets and passing them along to competing suppliers Intel.
The quarrels haven’t stopped since then, with the latest court case consisting of Apple suing Qualcomm for forcing it to pay licensing fees in order to even be allowed to buy Qualcomm 5G modem chips for its iPhones. Apple attorney Ruffin Cordell equated this policy to asking Kentucky Fried Chicken customers to buy licenses to eat fried chicken before it would sell them any.
The two companies managed to reach a settlement on Tuesday, however, right when things were about to get heated in the courts. Apple and Qualcomm struck a deal that put a stop to further prosecution for both parties (Qualcomm was also simultaneously running a case against Apple’s contracted manufacturers), at least for the time being.
And on Wednesday (the day following the settlement outside of court), the Federal Circuit officially ruled that as a consequence to Apple’s agreement to the settlement, the Cupertino giant has lost its right to invalidate Qualcomm patents.
This is in reference to a series of claims Apple had previously made on Qualcomm intellectual property, which were first rejected but then re-appealed by Apple to the Patent Trial and Appeal Board (PTAB).
And now that Apple has chosen to make peace with Qualcomm—in a deal which includes a global patent license and a chipset supply contract for years to come—Apple has now precluded its ability to continue pursuing its patent claims on Qualcomm.
“We do not write on a blank skate in assessing Apple’s standing here,” the Federal Circuit stated in the ruling yesterday. “Rather, as presaged above, the writing is already on the wall.”
Questions & Answers
Q.What was the core reason Apple initially accused Qualcomm of unfair practices?
What was the core reason Apple initially accused Qualcomm of unfair practices?
Apple accused Qualcomm of charging excessively high prices for its modem chips compared to what other competitors paid. This initial dispute led to a breakdown in their supplier relationship.
Q.What legal action did Qualcomm take against Apple after Apple diversified its suppliers?
What legal action did Qualcomm take against Apple after Apple diversified its suppliers?
Qualcomm launched multiple lawsuits against Apple, alleging that Apple was stealing its trade secrets. Qualcomm claimed these secrets were being passed on to competing suppliers, specifically Intel.
Q.What was the significance of the Federal Circuit's ruling following the settlement?
What was the significance of the Federal Circuit's ruling following the settlement?
The Federal Circuit officially ruled that, due to the settlement agreement, Apple has lost its right to invalidate Qualcomm patents. This means Apple cannot pursue its previous claims regarding Qualcomm intellectual property.
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