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Qualcomm tells court that Apple is holding its payments ‘ransom’

Qualcomm tells court that Apple is holding its payments ‘ransom’


Now seeks preliminary injunction on Apple’s suppliers

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Qualcomm is asking a court to force Apple’s iPhone and iPad manufacturers to pay up, since they’ve been withholding royalty payments for weeks under Apple’s instructions.

In a court filing yesterday, Qualcomm asked for a preliminary injunction against four of Apple’s suppliers — Foxconn, Pegatron, Wistron, and Compal — all of which it began suing for breach of contract earlier this month. Qualcomm said in April that Apple had instructed those companies not to pay royalties for devices they made using Qualcomm technology. It later said that would lead to a loss of $500 million in revenue this quarter alone because of the missing payments.

“[Apple] has chosen commercial ransom over judicial process.”

Qualcomm and Apple are locked in a worldwide legal dispute over patents and payments, with Qualcomm largely stuck playing defense. Apple has said that Qualcomm has been charging excessively high patent licensing fees for years, using its position as the dominant supplier of smartphone modems as leverage.

In its new filing, Qualcomm says that Apple is trying to force a settlement by throwing its weight around. “Apple could litigate against Qualcomm indefinitely; it has virtually unlimited resources (more than $256 billion in cash reserves) and already has filed multiple cases against Qualcomm not just in this court, but around the world. And when those cases end, Apple can file more cases,” the company writes in a new filing.

It goes on to say that Apple “has chosen commercial ransom over judicial process” and that it’s trying to get an unfair deal on Qualcomm’s technology “through coercion enabled by its enormous market power.”

Apple declined to provide a new comment on the filing, once again pointing to older remarks. In one of those, Tim Cook says that Qualcomm is “trying to charge Apple a percentage of the total iPhone value” when what it provides is “one small part of what an iPhone is.” In a separate statement from April, Apple says it’s suspending payments “until the correct amount can be determined by the court.”

Backing up Apple’s claims is a lawsuit from the Federal Trade Commission, which began suing Qualcomm earlier this year for anti-competitive practices in regard to how it obtains patent licenses. In filings earlier this month, Samsung and Intel also put their weight behind the FTC.