Emboldened by the recent Federal Trade Commission lawsuit against Qualcomm, Apple has also filed a complaint against the company, this time in Beijing. The Cupertino company is asking for 1 billion yuan or a little more than $145 million in damages.
Apple's case, which is filed before the Beijing Intellectual Property Court, is its second against the leading mobile chip maker. The first complaint was lodged before a district court in California last Jan. 20. Apple is seeking $1 billion in this lawsuit to cover promised rebates.
Apple: Corporate Revenge
The dominant narrative in the Apple lawsuit is that Qualcomm is executing corporate revenge after it cooperated with an FTC investigation about the latter's anticompetitive practices.
Apple has also indicated that Qualcomm is piggybacking on Apple's innovations, extracting royalties for every new feature the company is able to develop such as TouchID and its own camera module.
"To protect this business scheme Qualcomm has taken increasingly radical steps, most recently withholding nearly $1B in payments from Apple as retaliation for responding truthfully to law enforcement agencies investigating them," Apple told Mashable.
The cited payment explains the company's position that Qualcomm is failing to honor its commitment to license "standard essential patents" broadly and inexpensively.
To argue its case, the iPhone maker further followed FTC's position that Qualcomm is blackmailing its customers, threatening to withhold license for essential technologies if they do not comply to its preferred terms, which involves exorbitant amount for royalties.
This particular position, however, can lead one to wonder how Apple permitted itself to such onerous relationship for a long time. Its exclusive partnership with Qualcomm began in 2011 and persisted until 2016.
This is underscored by Apple's allegation that Qualcomm has been sitting on its old legacy patents and tend to collect royalties the company has nothing to do with. To provide context, Apple revealed that it is paying Qualcomm up to five times more for iPhone patents in comparison with how much other cellular patent licensors charge.
The chipmaker promptly dispatched its executive vice president and general counsel, Don Rosenberg, to lead its defense.
"These filings by Apple's Chinese subsidiary are just part of Apple's efforts to find ways to pay less for Qualcomm's technology," Rosenberg stressed in an official statement. "Apple was offered terms consistent with terms accepted by more than one hundred other Chinese companies and refused to even consider them."
Qualcomm has also previously expressed its willingness to face Apple in court. Commenting on the lawsuit filed in the United States, the company maintained that it is baseless, accusing Apple of mischaracterizing the terms of their contract.
Rosenberg also stated that the lawsuit is an opportunity for Qualcomm to clear itself and to reveal Apple's practices. This last is seen by some observers as a veiled threat to counter Apple's offensive.
Tech watchers are closely monitoring the current legal tussle because a number of Qualcomm's patented technologies, particularly the modem technology that connects the iPhone to cellular data, are crucial to Apple's devices.