Qualcomm Ramps Up Its Fight Against Apple Fight by Suing iPhone Makers
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Qualcomm on Wednesday filed suit against Apple device manufacturers Foxconn, Pegatron, Wistron and Compal Electronics -- the companies responsible for iPhone and iPad assembly -- for refusing to pay their licensing fees. The chipmaker says those four companies have "a long history of consistently paying royalties" but are now refusing to pay licensing fees on the Apple products they produce at Cupertino's request.
"Qualcomm seeks an order that would require the defendants to comply with their long-standing contractual obligations to Qualcomm, as well as declaratory relief and damages," the company said in a news release. "While not disputing their contractual obligations to pay for the use of Qualcomm's inventions, the manufacturers say they must follow Apple's instructions not to pay."
Apple did not immediately respond to PCMag's request for comment.
Qualcomm said its licensing agreements with the aforementioned manufacturers date back to before Apple even sold its first iPhone -- and that Apple isn't even a party in those contracts. The manufacturers, meanwhile, are still paying Qualcomm royalties for the use of its technology in non-Apple products.
"It is unfortunate that we must take this action against these long-time licensees to enforce our agreements, but we cannot allow these manufacturers and Apple to use our valuable intellectual property without paying the fair and reasonable royalties to which they have agreed," Qualcomm's Executive Vice President and General Counsel Don Rosenberg said in a statement. "As Apple continues to collect billions of dollars from consumer sales of its Qualcomm-enabled products, it is using its market power as the wealthiest company in the world to try to coerce unfair and unreasonable license terms from Qualcomm in its global attack on the company."
He went on to say that "the manufacturers must continue to live up to their obligations under these agreements and Apple should immediately cease its tortious interference."
The issue dates back January when Apple, alleging extortion, sued Qualcomm for $1 billion. Apple says Qualcomm withheld contractually obligated payments in retaliation for Apple's cooperation with a Korean investigation into its business practices. That investigation ended with the Korean antitrust agency levying a record $854 million fine against Qualcomm in December.
Qualcomm in April countersued Apple, claiming the iPhone maker breached and mischaracterized agreements and negotiations between the two companies. Apple since last month has been withholding payments to its manufacturers for the royalties they owe under their licenses with Qualcomm.