BrandArena: Apple files $1 billion suit against Qualcomm over royalty charges

Monday, 23 January 2017

Apple files $1 billion suit against Qualcomm over royalty charges

Technology company, Apple, has filed a $1 billion lawsuit against chip maker, Qualcomm. Apple is accusing Qualcomm of overcharging for chips and refusing to pay some $1 billion in promised rebates.

Apple sued Qualcomm, alleging that the chip company charges billions in patent royalties "for technologies they have nothing to do with."

In its complaint, Apple says that Qualcomm actually withheld $1 billion in payments it owes to Apple because Apple cooperated with the Korea Fair Trade Commission, or KFTC. Apple lawyers go on to make an extraordinary claim: that Qualcomm "attempted to extort Apple into changing its responses and providing false information to the KFTC in exchange for Qualcomm's release of those payments to Apple," but Apple refused.

Qualcomm is a major supplier to Apple and Samsung and these two companies accounted for its $23.5 billion revenue in its most recent fiscal year.

But Qualcomm General Counsel Don Rosenberg considers Apple’s claims “baseless.”

“Apple has been actively encouraging regulatory attacks on Qualcomm’s business in various jurisdictions around the world, as reflected in the recent KFTC decision and FTC complaint, by misrepresenting facts and withholding information.”

“We welcome the opportunity to have these meritless claims heard in court where we will be entitled to full discovery of Apple’s practices and a robust examination of the merits.”

This lawsuit comes days after the U.S. government accused the chip maker of using its dominant position as a supplier of certain phone chips to impose “onerous” supply and licensing terms on cellphone manufacturers. Qualcomm said it would also contest the FTC complaint.

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