Qualcomm ordered by US judge to pay Apple $1 billion

A US federal judge has ordered Qualcomm to pay Apple $1 billion in a preliminary ruling. This is in the context of the long-running legal battle between the two, in this case over Qualcomm’s refusal to pay compensation.

The judge ruled that Qualcomm must pay contractually agreed discounts to Apple, which amounts to approximately one billion dollars, Reuters writes. This is the preliminary outcome of a lawsuit filed by Apple against Qualcomm over two years ago for Qualcomm’s refusal to pay Apple a sum of money that was contractually agreed upon as a refund of previous licensing fees incurred by Apple.

This concerns the situation where the factories that make the iPhones pay Qualcomm billions of dollars for the use of technology patented by the chip designer, such as that for modems. Apple reimburses these costs to the factories. In addition, both companies have a separate agreement that Qualcomm will reimburse Apple for a portion of these patent fees, provided Apple refrains from initiating lawsuits and not filing legal complaints with regulators.

Qualcomm argues that Apple has breached these terms by urging other smartphone makers to complain about Qualcomm’s policies and submitting “false and misleading statements” to the Korean regulator. On that basis, Qualcomm believes that it also does not have to comply with the obligation to partially compensate Apple for the license costs.

Apple believes Qualcomm is engaging in illegal business practices that affect not only Apple, but the entire industry. Qualcomm’s Don Rosenberg says Apple has already responded to Qualcomm’s missed payments by causing contracted iPhone factories to refuse to pay Qualcomm nearly a billion dollars in royalties.

Partly in view of Qualcomm’s attitude, the current ruling will not quickly lead to the chip designer transferring the contractually agreed amount to Apple in the short term. The verdict is not yet final. A hearing will be held sometime next month.