Qualcomm owes Apple $1 billion rebate payment

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Qualcomm headquarters
The latest chapter in the Apple vs. Qualcomm case is unfolding.
Photo: Qualcomm

Apple has won the latest battle in the Apple vs. Qualcomm war. A judge has ruled that Qualcomm owes Apple close to $1 billion in patent royalty rebate payments.

Judge Gonzalo Curiel of the U.S. District Court for the Southern District of California made the ruling on Thursday. The payments were due as part of a business cooperation agreement made between the two companies during happier times in their relationship. It’s not going to necessarily mean Qualcomm handing over a $1bn check, though.

As Reuters explains the deal in its writeup:

“In general, the contract factories that built Apple’s iPhones would pay Qualcomm billions of dollars per year for the use of Qualcomm’s patented technology in iPhones, a cost that Apple would reimburse the contract factories for. Separately, Qualcomm and Apple had a cooperation agreement under which Qualcomm would pay Apple a rebate on the iPhone patent payments if Apple agreed not to attack in court or with regulators.”

Apple vs. Qualcomm

Apple sued Qualcomm around two years ago, claiming that it was owed $1 billion in rebates. Qualcomm had reportedly not paid this because Apple assisted South Korean regulators investigating Qualcomm’s business. From here, the battle between the two companies escalated. At present, the two are waging various legal battles around the world. One of the big issues now concerns Apple’s decision to switch to Intel chips for its newer iPhones.

A victory is great news for Apple — but it might not mean a new influx of cash. According to Qualcomm’s executive VP and general counsel Don Rosenberg, “Apple has already offset the payment at issue under the agreement against royalties that were owed to Qualcomm.” The final decision won’t be made until next month.

In the meantime, we’re still waiting for a verdict on another Apple vs. Qualcomm case, which heard its concluding statements this week. Qualcomm lawyers in that case are asking for $31 million from Apple for patent violations. Apple’s lawyers have argued that Apple owes Qualcomm “not one penny.”

Source: Reuters