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Apple sues Qualcomm for nearly $1 billion over unfair practices

by Brandon Russell | January 20, 2017January 20, 2017 2:20 pm PDT

A few days after the US Federal Trade Commission sued Qualcomm for anti-competitive practices, Apple has filed a lawsuit against the chipmaker for the same reason. The Cupertino company is suing Qualcomm for nearly $1 billion, arguing Qualcomm has been overcharging for the use of basic patents.

“Despite being just one of over a dozen companies who contributed to basic cellular standards, Qualcomm insists on charging Apple at least five times more in payments than all the other cellular patent licensors we have agreements with combined,” Apple argued, via CNBC.

Crucially, Apple says once it began cooperating with Korean officials who were investigation Qualcomm for antitrust practices in 2016, the chipmaker withheld $1 billion in payments.

Here is a portion of Apple’s statement:

For many years Qualcomm has unfairly insisted on charging royalties for technologies they have nothing to do with. The more Apple innovates with unique features such as TouchID, advanced displays, and cameras, to name just a few, the more money Qualcomm collects for no reason and the more expensive it becomes for Apple to fund these innovations. Qualcomm built its business on older, legacy, standards but reinforces its dominance through exclusionary tactics and excessive royalties.

In the FTC’s lawsuit, the agency argued that because Qualcomm’s patents are essential to industry-wide standards, they should be licensed out on fair, reasonable, and non-discriminatory (FRAND) terms. The lawsuits claim Qualcomm is unfairly forcing manufacturers to pay excessive fees.

Apple’s statement continues:

Apple believes deeply in innovation and we have always been willing to pay fair and reasonable rates for patents we use. We are extremely disappointed in the way Qualcomm is conducting is business with us and unfortunately after years of disagreement over what constitutes fair and reasonable royalty we have no choice left but to turn to the courts.

For what it’s worth, in its investigation of Qualcomm last year, South Korea’s antitrust regulator fined Qualcomm $853 million for violating antitrust laws.

CNBC

Brandon Russell

Brandon Russell enjoys writing about technology and entertainment. When he's not watching Back to the Future, you can find him on a hike or watching...

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