US Court tells Qualcomm to pay Apple nearly $1billion in Rebate Payments


The never-ending mess of Apple and Qualcomm legal disputes continued today.  While a court in California was awarding Qualcomm $31 million in damages against Apple, a Federal court in the US was ruling that Qualcomm owes Apple nearly a billion dollars, or £754 million from previous payment agreements.

The ruling made in the Southern District of California by Judge Gonzalo Curiel is in relation to patent royalty rebate payments. These payments were part of a collaboration agreement between the two American tech companies, in which they would both reimburse each other for the use of patented technologies.

Apple would reimburse contracted factories that had paid Qualcomm royalties for the use of its patents in the production of Apple smartphones. These contracted factories’ expenses would then be paid back by Apple through rebates paid by Qualcomm.

Qualcomm stated that they stopped paying the rebates because they believed Apple had negated the agreement by telling smartphone manufactures to make false claims to the Korean Fair Trade Commission, which was in the process of investigating the company.

Despite the ruling, the outcome awaits a trial in the case which is due to start next month. In a statement to Reuters Qualcomm’s VP and general counsel Don Rosenberg commented that:

“Although the Court today did not view Apple’s conduct as a breach of Apple’s promises to Qualcomm in the 2013 Business Cooperation and Patent Agreement, the exposure of Apple’s role in these events is a welcome development.”

In relation to the payments Rosenberg stated that:

“Apple has already offset the payment at issue under the agreement against royalties that were owed to Qualcomm.”

While Apple have said that it welcomes the courts decision and that it believes Qualcomm’s ‘illegal practices’ are damaging their shared technology industry.

Qualcomm’s clash with Apple is costing it heavily in legal fees and clearly weighing on the balance sheet, as well as the minds of its leadership: Qualcomm executives February 1 said they had reduced operating expenses by $850 million, but failed to meet their target of $1 billion owing, in part, to litigation costs.

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