Split decisions on Tuesday by a US government panel in
acrimonious patent disputes between iPhone-maker Apple and chip supplier
Qualcomm left their battle lines largely unchanged ahead of a US
Federal Trade Commission ruling and a major trial next month.
The International Trade Commission (ITC), a government agency
empowered to hear disputes over
patented technology, issued a final
ruling in one case that went in Apple’s favour while an ITC
administrative judge made a non-binding recommendation that supported
Qualcomm in another.
In both cases Qualcomm sought to have imports of Apple iPhone 7, 8
and X models containing chips made by Intel banned. Because iPhones are
made overseas, banning imports would choke Apple’s sales of the phones
in the US.
The two American companies have been locked for two years in
a legal dispute in which Apple has accused Qualcomm of unfair patent
licensing practices. Qualcomm has in turn accused Apple of patent
infringement.
“Qualcomm is using these cases to distract from having to answer for
the real issues, their monopolistic business practices,” Apple said in a
statement.
After praising the first decision in its favour, Qualcomm said it
would seek “reconsideration” of the second decision because it was at
odds with a jury trial the chip supplier won earlier this month in a
federal court in San Diego, where jurors found Apple infringed three
Qualcomm patents.
“The commission’s decision is inconsistent with the recent unanimous
jury verdict finding infringement of the same patent after Apple
abandoned its invalidity defence at the end of trial,” Qualcomm said.
“We will seek reconsideration by the commission in view of the jury
verdict.”
Gaston Kroub, a patent lawyer in New York not involved in the cases,
said Qualcomm’s strategy at the ITC was to use the threat of an import
ban to pressure Apple into reaching a settlement of all patent and
antitrust claims between the companies.
“Qualcomm will be happy they got at least something, but at the end
of day, with this final determination, Apple will be emboldened to think
it can continue to ward off Qualcomm’s attacks,” Kroub said. “I don’t
see anything here that would impact Apple’s defence strategy.”
The focus moves now to skirmishes that will likely be more important.
A ruling is expected soon in an antitrust case brought by the US
Federal Trade Commission accusing Qualcomm of abusing a monopoly on
mobile chip technology.
A case brought by Apple making similar claims goes to trial in April
in California over allegations Qualcomm seeks inflated royalties for
licensing its technology in violation of antitrust laws.
After the non-binding decision in Qualcomm’s favour was announced on
Tuesday, Apple shares closed down 1% to $186.79 in regular trading, and
Qualcomm closed up 2.4% to $58.
But the stocks reversed direction in late trading after the
announcement of the binding decision that favoured Apple. Apple shares
were up 0.73% and Qualcomm shares down 0.69%.
Qualcomm has filed lawsuits in the US, China, Germany and other
countries accusing iPhone of using its technology without authorisation.
Qualcomm has won sales bans against Apple in China and Germany,
though the China ban has not been enforced and Apple resumed sales of
phones in Germany by shipping phones with only Qualcomm chips.
Apple has also racked up victories by having many of Qualcomm’s
patents invalidated, at least on a preliminary basis. And the chip
supplier has been dealt setbacks in its FTC trial, where a pretrial
ruling forced it to license its technology to other chip firms.
Of the two cases decided on Tuesday by the ITC, the ruling favourable
to Apple can only be appealed to a federal court. The ruling favourable
to Qualcomm faces review by the full six-member ITC, which will make a
final decision.
- Reuters
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