Qualcomm Owes Apple Nearly $1 Billion Rebate Payment, US Judge Rules

Advertisement
By Reuters | Updated: 15 March 2019 13:53 IST
Highlights
  • Apple for years used Qualcomm's modem chips in its iPhones
  • Qualcomm's illegal business practices are harming us: Apple
  • The decision will not become final until after the trial in the case

A US federal judge has issued a preliminary ruling that Qualcomm owes Apple nearly $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.

Judge Gonzalo Curiel of the US 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 nearly $1 billion (roughly Rs. 7,000 crores) in rebate payments to Apple, which for years used Qualcomm's modem chips to connect iPhones to wireless data networks.

The payments were part of a business cooperation agreement between the two companies amid the peculiar patent licensing practices of the consumer electronics industry.

Advertisement

In general, the contract factories that built Apple's iPhones would pay Qualcomm billions of dollars per year for the use of Qualcomm's patented technology in iPhones, a cost that Apple would reimburse the contract factories for. 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.

In a lawsuit filed two years ago, Apple sued Qualcomm, alleging that the chip supplier had broken the cooperation agreement by not paying nearly $1 billion in patent royalty rebates.

Qualcomm, in turn, alleged that it stopped paying the rebate payments because Apple had broken the agreement by urging other smartphone makers to complain to regulators and making "false and misleading" statements to the Korean Fair Trade Commission, which was investigating Qualcomm over antitrust allegations. Apple responded that it was making lawful responses to regulators in an ongoing investigation.

Advertisement

Judge Curiel sided with Apple, ruling that Qualcomm owed the missed rebate payments.

"Qualcomm's illegal business practices are harming Apple and the entire industry," Apple said in a statement.

Advertisement

Don Rosenberg, executive vice president and general counsel of Qualcomm, told Reuters in a statement, “Although the Court today did not view Apple's conduct as a breach of Apple's promises to Qualcomm in the 2013 Business Cooperation and Patent Agreement, the exposure of Apple's role in these events is a welcome development.”

The decision will not become final until after the trial in the case, which begins next month. And it is unlikely that Qualcomm will make a new payment to Apple.

Advertisement

Apple's contract factories, which under normal circumstances would pay Qualcomm for patent royalties owed on iPhones, have already withheld the nearly $1 billion in payments to Qualcomm. Qualcomm's Rosenberg said those withheld iPhone payments have already been accounted for in Qualcomm's existing financial statements.

“Apple has already offset the payment at issue under the agreement against royalties that were owed to Qualcomm,” Qualcomm's Rosenberg told Reuters.

© Thomson Reuters 2019

 

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.

Further reading: Apple, Qualcomm
Advertisement

Related Stories

Popular Mobile Brands
  1. Samsung Launches Galaxy A07, Galaxy F07, and Galaxy M07 4G in India
  2. Vivo X300 Series Surfaces on Certification Sites; Battery Details Leaked
  3. BSNL Finally Launches Voice Over Wi-Fi for Improved Calling in These Circles
  4. OnePlus 15 Launch Date Leaked: OxygenOS 16 to Offer Gemini AI Integration
  5. Lava Bold N1 Lite Listed on Amazon Ahead of Official Launch in India
  6. WhatsApp May Soon Let You Reserve Your Preferred Username on Android
  7. Oppo Find X9 Series Bags Certifications in These Countries, May Launch Soon
  8. Consumer Affairs Ministry to Probe Hidden Charges on E-Commerce Platforms
  1. M5 iPad Pro, AirTag 2 Launch Countdown: This Is When Apple Can Announce October Event
  2. WhatsApp for Android Said to Be Testing a Feature That Lets Users Reserve Their Usernames
  3. Samsung Galaxy A07, Galaxy F07, and Galaxy M07 4G Launched in India: Price, Specifications
  4. Lava Bold N1 Lite With 5,000mAh Battery Listed on Amazon Ahead of Launch: Price in India, Specifications
  5. Samsung Galaxy Z Fold 7 Special Edition China Launch Date Announced: Expected Features
  6. Google Said to Be Testing ‘More Efficient’ MediaTek Modem for Pixel 11 Series
  7. Call of Duty: Black Ops 7 Beta Early Access Goes Live as Players Report Cheating
  8. Department of Consumer Affairs to Probe E-Commerce Platforms Over Hidden Cash-on-Delivery Charges
  9. Ubisoft Launches Tencent-Backed Subsidiary, Vantage Studios, to Run Assassin's Creed, Far Cry, and Rainbow Six
  10. OnePlus 15 Global Launch Date Leaked; OxygenOS 16 to Offer Gemini AI Integration With Plus Mind Feature
Gadgets 360 is available in
Download Our Apps
Available in Hindi
© Copyright Red Pixels Ventures Limited 2025. All rights reserved.