Qualcomm has filed a complaint regarding the breach of license agreement against Foxconn and three of other Apple suppliers for not paying royalties to it. This is the latest development in the lawsuit battle going on between Qualcomm and Apple over the amount of that the Cupertino company needs to pay for using some of its licensed technology inside its products.
The other three Apple suppliers who have not paid Qualcomm royalties include Pegatron, Wistron, and Compal Electronics.
Qualcomm says that Foxconn and other major Apple suppliers are not paying any royalties to it on instructions from Apple, which is why the chipmaker is suing them as well. It says that the contract agreement with these companies have existed even before Apple sold the first iPhone and that the Cupertino company has no right to interfere in its business. The chipmaker notes that all the four contractors continue paying it royalties on the sale of non-Apple related 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,” said Don Rosenberg, executive vice president and general counsel of Qualcomm.
“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. Our license agreements with Apple’s manufacturers remain valid and enforceable. The manufacturers must continue to live up to their obligations under these agreements and Apple should immediately cease its tortious interference.”
Apple refused to pay Qualcomm over $1 billion in royalty and has withheld its payment since then. The company also urged its suppliers to do the same. A couple of months after Apple’s lawsuit, Qualcomm also eventually went ahead and filed a countersuit against Apple saying that its claims were baseless.
Qualcomm has already had to adjust its third quarter earning guidance due to its royalty payment being withheld by Apple. With Apple’s contractors now also doing the same, the company’s earnings are going to be further adversely affected as well.[Via Qualcomm]