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Qualcomm sues Apple device makers for unpaid royalties

The popularity of smartphones has been a real boon to chip-maker Qualcomm - as it has been for Apple
Qualcomm and Apple are at loggerheads over high prices (Qualcomm's - not Apple's)

Semiconductor technology company Qualcomm Inc (NASDAQ:QCOM) has sued four manufacturers of Apple Inc (NASDAQ:AAPL) devices, claiming it has not been paid royalties it is due.

The move is the latest salvo in its running battle with the iPhone maker, which has reportedly instructed Taiwanese companies Foxconn Technology Group, Pegatron Corp, Wistron Corp and Compal Electronics not to pay Qualcomm royalties for the first quarter of 2017 until a legal spat between the two US companies is resolved in court.

Apple sued the chip-maker in January, accusing it of overcharging for chips and refusing to pay around US$1bn in promised rebates.

Apple has also reportedly offered to make good any losses the device makers may suffer as a result of breaching their agreements with Qualcomm.

The chip-maker has seized on this as an admission of guilt.

"While not disputing their contractual obligations to pay for the use of Qualcomm's inventions, the manufacturers say they must follow Apple's instructions not to pay," Qualcomm’s statement said.

Apple, known for charging eye-watering amounts for its products – especially its peripherals – sued Qualcomm in January claiming it abused its monopoly position to impose "onerous, unreasonable and costly” terms on customers.

Shares in Qualcomm were down 0.5% after an hour of trading but that was about half the level of the fall suffered by the wider market. 

They closed out down 1.05% on the day.


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September 18 2015
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