Qualcomm asked U.S. trade authorities to block imports of some iPhones and iPads, escalating a massive battle over patent royalties that began in January.
The chipmaker said it filed a suit with the U.S. International Trade Commission accusing Apple of illegally importing and selling iPhones “that infringe one or more claims of six Qualcomm patents covering key technologies that enable important features and functions in iPhones.” The company plans to file a second complaint today asking the ITC to halt Apple’s importations of phones and tablets that don’t include Qualcomm’s components, The Wall Street Journal reported.
“Qualcomm’s inventions are at the heart of every iPhone and extend well beyond modem technologies or cellular standards,” Qualcomm General Counsel Don Rosenberg said in a press release. “The patents we are asserting represent six important technologies, out of a portfolio of thousands, and each is vital to iPhone functions. Apple continues to use Qualcomm’s technology while refusing to pay for it. These lawsuits seek to stop Apple’s infringement of six of our patented technologies.”
Apple didn’t respond to a request for comment from FierceWireless.
The six patents at the heart of the allegations cover technologies that enable high-speed performance and extend battery life, Qualcomm said, noting that the patents are not required for any industry standard. The technologies are used for streaming media, social media interaction and basic communications, among other functions.
Qualcomm outlined the patents in question in the following infographic:
Apple earlier this year filed a $1 billion lawsuit against Qualcomm, contending the chipmaker insists on onerous royalties for its technologies and demands payments for technologies it didn’t develop, such as Apple’s Touch ID. Apple claimed in that suit that it “has been overcharged billions of dollars on Qualcomm’s illegal scheme,” although the suit seeks damages of just less than $1 billion.
Qualcomm filed a countersuit in April, claiming among other things that the iPhone vendor “breached” and “mischaracterized” agreements with the chipmaker and interfered in deals with Qualcomm licensees.
Apple returned fire last month, saying in a legal filing that evidence increasingly indicated Qualcomm’s business model is “illegal.” That complaint alleged that Qualcomm’s strategy “burdens innovation," and that some patents for which Qualcomm is demanding royalties are invalid.
Although the battle between the two tech heavyweights isn’t likely to be decided for a year or more, the impact of Qualcomm's latest move may be felt well before then, according to Maynard Um of Wells Fargo Securities.
“Qualcomm expects the ITC investigation to start in August and the case to be tried next year,” Um wrote in a note to investors. “If the ITC case follows the timeline of other similar ITC cases, an initial determination could come towards the end of 2018. We believe today’s legal actions are to put additional pressure on Apple from its suppliers (Intel and others). While resolution does not appear imminent, we believe these legal battles will continue to be an overhang and expect potential share price volatility around court decisions (we do not believe shares are discounting any negative outcome of an injunction).”