Apple Inc. had previously sued Qualcomm Inc., saying that the chip maker has withheld $1 billion because Apple had helped Korean authorities investigate Qualcomm. Now, broadening the case Apple has also said that the chip maker is using business malpractices to secure a cut out of every wireless device with a Qualcomm chip sold. If Apple wins the case Qualcomm will lose a core tenet of its business model.
As reported by Reuters, the initial case filing only focused on whether or not Apple breached the contract with Qualcomm. This new filing has expanded in on that case and seeks to stop Qualcomm from utilising their long-standing business model, this has been based on the ruling passed in another case last month.
Last month, the U.S. Supreme Court gave an order making it harder for manufacturers to control how their products are used or resold, this was given in a patent dispute case against Lexmark International Inc. over the resale of its used cartridges.
Apple also stated that Qualcomm requires its customers to sign a patent license agreement before they sell them any chips, which is also known as “no licence, no chips”. This license allows the chip maker to take a percentage of the selling price of the phone on each phone sold.
Apple buys its modem chips from Qualcomm which helps the Apple products connect to cellular data networks. Apple stating the Lexmark ruling showed that Qualcomm can only take a one time fee and nothing in perpetuity.Apple wants to be able to buy chips without signing the licence agreement that forces it to pay a part of the overall iPhone sale price.
Apple also recommended the court to drop the lawsuits that Qualcomm had filed against Foxconn and three other companies which assemble the iPhone.