Apple, Qualcomm settle all legal disputes
The settlement includes an unspecified payment from Apple to chipmaker Qualcomm.
The settlement was announced as opening arguments were beginning in San Diego federal court in the federal trial of a patent dispute between the two tech giants.
Both companies will still work together, too. Apple and Qualcomm announced a new six-year license contract, with the option to add two more years. It also announced a multi-year chipset supply agreement.
“Qualcomm and Apple today announced an agreement to dismiss all litigation between the two companies worldwide,” according to a joint statement issued by the companies. “The settlement includes a payment from Apple to Qualcomm. The companies also have reached a six-year license agreement, effective as of April 1, 2019, including a two-year option to extend, and a multiyear chipset supply agreement.”
Qualcomm stock soared as much as 22% following the settlement. Apple stock was flat.
The companies appeared in court on Monday in a trial that was expected to last for four to six weeks in San Diego. Apple CEO Tim Cook was expected to take the stand.
Apple alleged that Qualcomm — which has made crucial chips for the iPhone — charged an unfair amount to license its patents to place calls, connect to the internet and for other technologies, including audio and video.
Qualcomm could have been on the hook for as much as $27 billion in damages for overpaid royalty fees. Qualcomm was seeking over $7 billion in unpaid royalties from Apple and its supplier, as well as other damages totaling billions of dollars.
Over the past two years, the companies have sued one another in courts around the world, and each has seen some victories along the way.
The epic legal battle started in January 2017 when Apple sued Qualcomm for nearly $1 billion. Apple accused Qualcomm of charging “excessive royalties” and withholding payments in retaliation for Apple cooperating with a South Korean investigation into the chipmaker.
The companies also sued each other in several other patent disputes. For example, in one case, Qualcomm asked a US federal judge to ban the sale of iPhones.