iPhone manufacturers join Apple in Qualcomm legal spat – CNET

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This chip is behind the legal drama that’s been unfolding for several months.

Qualcomm

Apple allies are joining the company’s court battle against chipmaker Qualcomm.

Four iPhone manufacturers have filed a suit against Qualcomm, alleging it used its market position to charge excessive royalties, Reuters reported Wednesday. The four companies are Foxconn parent Hon Hai Precision Industry, Wistron, Compal Electronics and Pegatron.

The move is a rebuttal to Qualcomm’s suit filed in May, which seeks to press the contractors into paying license fees after they stopped doing so. Until earlier this year, Apple would pay its manufacturers to cover the Qualcomm royalty fees. Since Apple decided to stop coughing up the money, the fee has been unpaid. Apple said it won’t resume payment until its related problem with Qualcomm — it sued the chipmaker in January, accusing it of unfair licensing terms — is resolved.

“Qualcomm has confirmed publicly that this lawsuit against our clients is intended to make a point about Apple and punish our clients for working with Apple,” Theodore Boutrous, a lawyer representing the four companies, said in a statement seen by Reuters. “The companies are bringing their own claims and defenses against Qualcomm.”

In response, Qualcomm President Derek Aberle said in a conference call Wednesday that Apple has “interfered” with its agreement with the contractors by “instructing them not to pay the royalties they owe for sales of Apple products.” 

“It is clear that Apple is controlling all of the contract manufacturers’ … actions in the litigation. If Apple hadn’t interfered with the licenses and instructed the contract manufacturers to take these actions, the contract manufacturers would not be contesting the licenses now,” he added.

Apple isn’t the only one claiming Qualcomm engages in anti-competitive behavior. Previously, courts in China and South Korea have found the chipmaker guilty of antitrust violations, and each imposed a penalty of almost $1 billion. The company is also in dispute with the US Federal Trade Commission and the European Commission over the same issue.  

Separately, Qualcomm is upping its game against Apple, filing new litigation Wednesday against the latter in Germany, Aberle said.

The filing accused Apple of infringing on patents for ways to transmit information without draining battery life, which Aberle said are “important” to iPhone’s functionalities. This is similar to what it filed in Washington seeking a ban on Apple products that aren’t equipped with Qualcomm chips in the US.

Apple did not immediately return CNET’s request for comment.

First published July 20 at 12:18 a.m. PT.
Update at 2:46 a.m. PT: Adds comment from Qualcomm.

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