Foxconn not in settlement talks with Qualcomm in Apple battle -attorney (updated)
17/12/2018 04:49
(Adds request for comment from Qualcomm, adds detail on Chinese
court orders, adds information from Nov. 30 court hearing in
United States)
By Stephen Nellis
SAN FRANCISCO, Dec 16 (Reuters) - The lead attorney for the
group of Apple Inc AAPL.O device assemblers seeking at least
$9 billion in damages from Qualcomm Inc QCOM.O said on Sunday
the contract manufacturers are not in settlement talks with the
mobile chip supplier and are "gearing up and heading toward the
trial" in April.
The conflict is but one aspect of the global legal battle
between regulators, Apple and Qualcomm, which supplies modem
chips that help phones connect to wireless data networks.
Last week, Qualcomm secured a preliminary victory in a
patent lawsuit in China that would have banned sales of some
Apple iPhones there. Apple later said it believed it was already
in compliance but would change its software "to address any
possible concern" about its compliance. urn:newsml:reuters.com:*:nL3N1YJ24D
But Qualcomm was also handed a setback in an antitrust
lawsuit brought against it by the U.S. Federal Trade Commission
when a judge said it will not be able to mention that Apple
ditched Qualcomm chips for competing ones from Intel Corp
INTC.O when the case goes to trial next month. urn:newsml:reuters.com:*:nL1N1YI2G9
Qualcomm representatives did not immediately return a
request for comment on Sunday outside of U.S. business hours.
The group of contract manufacturers - which includes Foxconn
parent Hon Hai Precision Industry Co Ltd 2317.TW , Pegatron
Corp 4938.TW , Wistron Corp 3231.TW and Compal Electronics
Inc 6674.TW - became embroiled in the dispute between Apple
and Qualcomm last year.
In the supply chain for electronics, contract manufacturers
buy Qualcomm chips and pay royalties when they build phones, and
are in turn reimbursed by companies like Apple. Qualcomm sued
the group last year, alleging they had stopped paying royalties
related to Apple products, and Apple joined their defense.
The contract manufacturers have since filed claims of their
own against Qualcomm, alleging the San Diego company's practice
of charging money for chips but then also asking for a cut of
the adjusted selling price of a mobile phone as a patent royalty
payment constitutes an anticompetitive business practice.
They are seeking $9 billion in damages from Qualcomm for
royalties they allege were illegal. That figure could triple if
the manufacturers succeed on their antitrust claims.
Ted Boutrous, a high-profile partner at Gibson, Dunn &
Crutcher LLP who is representing the contract manufacturers,
told Reuters that statements from Qualcomm executives suggesting
there were meaningful settlement talks with the contract
manufacturers were "false."
"To the extent Qualcomm has indicated there have been
licensing discussions with the contract manufacturers, they've
basically made the same sort of unreasonable demands that got
them to where they are right now, which impose significant
preconditions to even discuss a new arrangement," Boutrous said.
In July, Qualcomm CEO Steve Mollenkopf told investors on the
company's quarterly earnings call that Qualcomm and Apple itself
were in talks to resolve the litigation.
At a hearing in the case in San Diego on Nov. 30, one of
Apple's attorneys disputed that notion, saying there had not
been "talks in a number of months. So the parties are at
loggerheads and are going ... to have to go into trial."
(Reporting by Stephen Nellis in San Francisco; Editing by Chris
Reese and Himani Sarkar)
((Stephen.Nellis@thomsonreuters.com; (415) 344-4934;))