Qualcomm hits Apple with patent countersuit as battle escalates

Qualcomm filed a countersuit against Apple, claiming among other things that the iPhone vendor “breached” and “mischaracterized” agreements with the chipmaker and interfered in deals with Qualcomm licensees.

Apple filed a $1 billion lawsuit against Qualcomm in January over patent royalties just days after the dominant chipmaker was sued by the Federal Trade Commission on charges of anticompetitive practices. The suit contends that Qualcomm insists on onerous royalties for its technologies and demands royalties for technologies it didn’t develop—such as Apple’s Touch ID.

Apple claims it “has been overcharged billions of dollars on Qualcomm’s illegal scheme” through the suit and seeks damages of just less than $1 billion.

Apple also accused Qualcomm of withholding nearly $1 billion in payments in retaliation for Apple’s cooperation with law enforcement agencies investigating Qualcomm. The iPhone vendor requested a jury trial.

Qualcomm fired back this week, though, claiming in a 139-page filing that Apple failed to “engage in good faith negotiations for a license to Qualcomm’s 3G and 4G standard essential patents on fair, reasonable and non-discriminatory terms.” Apple is accused of interfering with long-standing deals between Qualcomm and licensees that manufacture iPhone and iPads, encouraging regulatory attacks by misrepresenting facts and making false statements and choosing not to utilize the full performance of Qualcomm’s chips in the iPhone 7 in an effort to misrepresent their performance.

Apple is also accused of threatening to prevent Qualcomm from making public comparisons “about the superior performance” of Qualcomm-powered iPhones.

“Qualcomm is the world leader in inventing and developing fundamental, groundbreaking mobie technologies that enable the worldwide mobile ecosystem,” said Don Rosenberg, Qualcomm’s executive vice president and general counsel, in a press release. “Over the last ten years, Apple has played a significant role in bringing the benefits of mobile technology to consumers with its popular products and services. But Apple could not have built the incredible iPhone franchise that has made it the most profitable company in the world, capturing over 90% of smartphone profits, without relying upon Qualcomm’s fundamental cellular technologies.”

The countersuit escalates a major standoff between the two tech heavyweights even as Qualcomm fights multiple other legal battles around the world. In April, Nvidia sued Qualcomm in London, alleging it had unfairly forced Nvidia to pull the plug on the Icera business it bought in 2011. Qualcomm also faces a fine in South Korea of $853 million over alleged antitrust violations.

And earlier this year, the FTC filed suit against Qualcomm, accusing it of using anticompetitive tactics to “maintain its monopoly” as the dominant vendor of semiconductors for phones and other mobile gadgets. The agency said Qualcomm imposed “onerous and anticompetitive supply and licensing terms” on hardware manufacturers, violating the FTC Act on several fronts.