Apple has filed a lawsuit against Qualcomm, accusing the chip maker of failing to cough up $1 billion in promised rebates. The move comes as a major blow to the latter as it’s also facing legal action from the US government.
Apple claims that Qualcomm withheld the rebates as revenge against the Cupertino-based giant’s participation in the Korea Fair Trade Commission’s probe into Qualcomm’s business practices. It goes as far as to assert that Qualcomm tried to extort it by promising to hand over the $1 billion owed if it agreed to change its responses and provide false information.
The Korea Fair Trade Commission’s investigation notably resulted in a huge $854 million fine. Apple’s lawsuit further states that Qualcomm is using its monopoly power to ignore FRAND (fair, reasonable and nondiscriminatory) patent commitments. The company is supposedly charging massive royalty rates on standard-essential patents (SEPs) covering cellular communications standards.
Qualcomm seemingly refuses to vend chipsets to OEMs until it first licenses the manufacturer’s SEPs at extortion-level rates. It’s also been accused of pressurizing carriers to not sell or support iPhones which run on Intel chipsets. Apple’s handsets exclusively contained Qualcomm’s SoCs up until the iPhone 7.
Qualcomm for its part has responded to the allegations by terming them baseless. It says Apple is intentionally mischaracterizing its agreements, negotiations, and enormity of the technology it has shared via its licensing program. The brand asserts that Apple is actively egging on regulatory attacks on its business across the world.
Interestingly, Recode reports that Qualcomm is going to continue doing business with Apple in spite of the lawsuit and potential countersuits.