updated 09:15 am EDT, Mon April 27, 2009
Qualcomm to pay $891m
After weeks of trying to reach a settlement and put an end to the long-standing legal battles between them, lawyers at rival chipmakers Broadcom and Qualcomm came to an agreement, with Qualcomm agreeing to pay $891 million to Broadcom over four years. This marks the second payment Qualcomm will be making to the smaller Broadcom in lawsuits, though the first, at $19.6 million, was significantly smaller. Reuters reported the first payment of $200 million to settle the supposed patent infringements will be made in the current quarter.
With the settlement, the patent infringement claims filed by Broadcom at the International Trade Commission and a Santa Ana, California court, as well as all other litigation between the companies, will be dismissed. Broadcom will also withdraw its complaints at the European Commission and the Korea Fair Trade Commission. This may not result in the two regulating bodies to cease investigating the matter, however. The chipmakers also agreed not to assert patents against each other for chips and other products and services.
Qualcomm wanted to avert future bans of sales of its products in markets, like the one issued by the US International Trade Commission in the summer of 2007 that would stop the sale of cellphones offered by Verizon. Qualcomm general counsel Donald Rosenberg said a concern was a growth of the injunction, and both companies wishing to put it all behind them and focus on their business.
The settlement will not affect Qualcomm's ability to make a large part of its profits from selling licenses that draw on its wireless technology patents used in 3G wireless technologies and upcoming 4G technologies.