Qualcomm, facing legal challenges to its lucrative technology licensing business, asked a judge to order manufacturers of Apple’s iPhone to keep paying it during a dispute over royalty payments.
The chipmaker already is suing four Asian contract manufacturers, including Foxconn Technology Group and Pegatron Corp, for not paying licensing fees. On Wednesday, it filed a request in San Diego federal court for an order forcing them to continue to make licensing payments.
The move is the latest by Qualcomm, the largest maker of chips that run mobile phones, to fight back against lawsuits and regulatory action that threaten a business that provides it with the majority of its profits. In April, the San Diego-based company said revenue this quarter may be down by more than $1bn from its earlier predictions because Apple had cut off payments to it through contract manufacturers, the mechanism by which it’s been paid for use of its technology in the iPhone.
“We’re asking the court to order each of the contract manufacturers to pay the amount they are obliged to pay,” said Qualcomm General Counsel Don Rosenberg. “They have an absolute obligation to pay us. The contract is not negotiable.”
Rosenberg estimated it will take the judge overseeing the case about two months to issue a decision. While such orders aren’t easy to win, Rosenberg said his company has a strong case because the manufacturers have a long history of making the payments and have legally binding licensing agreements directly with Qualcomm, regardless of what action Apple takes.
“It’s not just money, it’s a lot of money,” he said.
In response to the filing, Apple reiterated its position on the case.
“We’ve been trying to reach a licensing agreement with Qualcomm for more than five years but they have refused to negotiate fair terms,” Apple said in an e-mailed statement. “Without an agreed-upon rate to determine how much is owed, we have suspended payments until the correct amount can be determined by the court. As we’ve said before, Qualcomm’s demands are unreasonable and they have been charging higher rates based on our innovation, not their own.”
The other two companies Qualcomm sued are Wistron Corp and Compal Electronics. The four firms began withholding payments after Apple stopped paying them as it ramped up its dispute with the chipmaker. Qualcomm gets a percentage of the selling price of almost all smartphones sold industrywide because of patents it owns that cover the fundamentals of modern phone systems.
Apple accused Qualcomm in a January antitrust complaint of illegally trying to control the market for chips and improperly withholding more than $1bn in “rebates” to punish the iPhone-maker for talking to Korean regulators.
Qualcomm countered that Apple is behind regulatory investigations of its business practices worldwide and has inspired legislative action against it with false accusations.




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