This Friday, a jury awarded Qualcomm $31 million in a patent infringement suit against Apple. Report Edvard Pettersson and Bill Callahan of Bloomberg:
Qualcomm Inc. won the first U.S. jury trial in its global dispute with Apple Inc. over how much the iPhone maker should pay for using the chipmaker’s patented technology.
A federal jury in San Diego on Friday awarded Qualcomm about $31.6 million in damages on its patent infringement claims. Qualcomm jumped as much as 3.5 percent before finishing up 2.2 percent at the close in New York trading…
Apple has switched to using Intel Inc. chips in its phones. The Cupertino, California-based company has accused Qualcomm of using its control over so-called standard essential patents, which covers technology uniformly adopted by telecommunications providers and equipment makers, to extract excessive royalties for the entire patent portfolio, including non-essential patents, that it licenses to smartphone makers.
But Apple may have a chance to strike back. Another case has been filed by the Federal Trade Commission against Qualcomm (currently being decided) for allegedly uncompetitive practices enabled by their patents. Indeed, according to Bloomberg:
The companies had a falling out in 2016 when Qualcomm — which had been the exclusive supplier of iPhone chipsets for five years — halted quarterly royalty rebates it had been paying Apple. The chipmaker has said it ended the rebates because Apple instigated antitrust investigations of Qualcomm and lied to regulators.
While Apple’s actions did constitute infringement in the eyes of the jury, there is one notable lesson that policymakers should take heed of. Apple paid a relatively modest sum for its unlicensed use (less than two bucks per phone), but the Court’s preference to use monetary damages rather than outright sales bans shows an example of a potential reform to the patent system: compulsory licensing, with prices set by courts if they are found unreasonable.