The experts at Dawn Ellmore Employment review the details of the long-running dispute between Apple and Qualcomm that ended abruptly.

1. The battle between Apple and Qualcomm
Editorial credit: Songquan Deng / Shutterstock.com
To a chorus of general surprise from the industry, Apple and Qualcomm have
ceased all litigation against each other. Since 2017, the two tech giants have been
taking each other to court all around the world.
Cases in Germany and China have already ruled in the chip-maker’s favour, but in
others, Apple came out top. So, why have the two companies abruptly ended the
fight?
A tale of two tech companies
The federal court date of the latest legal battle was set for 15 April 2019. Just before
it began, Apple and Qualcomm announced their surprise reconciliation. All legal
action stopped on the same day, including that of Apple’s manufacturing partners.
And while there is no clear-cut reason given for the ceasefire, it likely has something
to do with both companies not wanting to have their inner workings discussed in
federal court.
Despite Apple repeatedly hinting that no such deal would happen, saying that the
two companies hadn’t spoken in months, the declaration of peace has taken the
industry by surprise.
Basis for federal court case
This patent dispute was about Apple coming down on Qualcomm for charging too
much for their patent royalties. Apple alleged that Qualcomm was charging them
twice, once when they licensed the patent portfolio, and again when they bought
cellular chipsets.

2. Qualcomm disputed this, and in a move that could have cost them billions, stood by
its licensing strategy. If the case had run its course and the judge found Qualcomm
guilty of Apple’s assertions, the chipmaker could have been on the line for up to £27
billion in damages, according to CNN.
For its part, Qualcomm demanded more than $7 billion from Apple in what it claimed
was unpaid royalties. The case was set for a San Diego federal court and was
scheduled to last up to six weeks.
On the same day as the court case was due to start, another of Apple’s chip
providers dropped its own bombshell. Intel had been developing 5G ready chips for
the next generation of smartphones but announced that they are dropping the
development. This means Apple really needs Qualcomm as a partner.
History of Apple V Qualcomm
In January 2017, Apple accused Qualcomm of charging excessive royalties, and
sued them for around $1 billion. A year later, Qualcomm was ordered to pay a fine to
Apple by the European Commission, which said the chip manufacturer had flouted
EU regulations in paying Apple to stop the company from using other chip
manufacturers.
Subsequently, both parties sued each other for various patent issues, and profit
problems. Qualcomm even demanded that a judge in America should ban the sale of
iPhones.
By summer 2018, Qualcomm vetoed Apple using its chips in the next generation of
phones. And in March 2019, a US trade judge called for some iPhones being
imported into the US to be banned as Apple had violated a patent owned by
Qualcomm.
What does the cessation of hostilities mean?
The deal between Apple and Qualcomm is backdated to 1 April. There is a new long-
term agreement for Qualcomm to supply Apple with chips, and Apple has agreed to
pay an unspecified amount, and the deal also includes an extension option.
It is more of a win for Qualcomm than Apple, given that the former company’s very
business model has been under attack from various parties around the world. Taking
the risk was worth it, as Qualcomm’s share price jumped by 23% when the
announcement was made.
Whether it will affect consumers in terms of smartphone prices is less clear, although
Qualcomm promises to shed light on this when financial results are released on 1
May. Either way, it’s all taken the industry by surprise, given Apple’s track record for
taking IP battles to court.
About Dawn Ellmore Employment
Dawn Ellmore Employment was incorporated in 1995 and is a market leader in
intellectual property and legal recruitment.