Qualcomm Accuses Apple of Helping Intel Using Qualcomm Software

Qualcomm on Wednesday filed yet another lawsuit against Apple, this time accusing the company of breaching software licensing terms and using Qualcomm code to help Intel, reports Bloomberg.

According to Qualcomm, Apple breached a contract that dictates the use of software that's designed to make Qualcomm chips work with other iPhone components. Qualcomm also believes Apple may have used its access to that software to help Intel with its own modem chip development.


Since 2016, Apple has been using LTE chips from both Intel and Qualcomm in an effort to diversify its supply chain and move some production away from Qualcomm. The iPhone 7, 7 Plus, 8, and 8 Plus all use a mix of Qualcomm and Intel chips.

In light of the ongoing legal battle with Qualcomm, Apple is said to be considering eliminating Qualcomm chips from its devices all together, instead adopting chips from Intel and possibly MediaTek. Rumors suggest Qualcomm has been withholding software from Apple that Apple needs to test prototype devices for next year, forcing Apple's hand.

Qualcomm and Apple have been involved in an escalating legal fight since the beginning of the year after Apple sued Qualcomm for $1 billion. Apple has accused Qualcomm of charging unfair royalties for "technologies they have nothing to do with" and failing to pay for quarterly rebates.

Apple has since stopped paying royalties to Qualcomm until new licensing fees have been worked out, as have Apple suppliers, significantly impacting Qualcomm's profits.

Qualcomm has since levied several lawsuits against Apple, accusing the company of patent infringement and asking both the United States and China to block imports and exports of some iPhone models.


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Apple Considering Eliminating Qualcomm Chips From Next Year’s iPhones and iPads

Amid an escalating legal battle with Qualcomm, Apple is designing its 2018 iPhones and iPads without Qualcomm LTE chips, reports The Wall Street Journal. Apple is instead considering using only modem chips from Intel and perhaps MediaTek in its next-generation devices.

Qualcomm is allegedly withholding software that Apple needs to test LTE chips in its iPhone and iPad prototypes, necessitating the move.


The Wall Street Journal's sources say Qualcomm stopped sharing the software following the January lawsuit Apple filed against the company, hindering Apple's development efforts, but Qualcomm claims Apple has already tested the chip that would be suitable for the next-generation iPhone.
Qualcomm said its "modem that could be used in the next generation iPhone has already been fully tested and released to Apple." The chip company said it is "committed to supporting Apple's new devices" as it does for others in the industry.
Apple has used Qualcomm modem chips in its devices for many years, but began diversifying last year with the addition of Intel modem chips in the iPhone 7 and the iPhone 7 Plus. The iPhone 8 and the iPhone 8 Plus also use both Intel and Qualcomm chips. In the United States, AT&T and T-Mobile models use chips from Intel, while Verizon and Sprint models use chips from Qualcomm.

According to The Wall Street Journal, Apple's plans to stop using Qualcomm chips in its 2018 devices could still change. Apple could switch suppliers as late as June, three months before the launch of the 2018 iPhone.

Apple and Qualcomm have been embroiled in a legal battle since the beginning of the year after Apple sued Qualcomm for $1 billion, accusing the company of charging unfair royalties for "technologies they have nothing to do with" and failing to pay for quarterly rebates.

Apple stopped paying licensing fees to Qualcomm at that time, as did Apple suppliers. Apple maintains that Qualcomm charges excessive licensing fees by requesting a percentage of an iPhone's entire value, while Qualcomm says its technology is "at the heart of every iPhone."

Qualcomm has since countersued and filed several patent infringement lawsuits against Apple. Qualcomm has also asked the United States International Trade Commission to block imports of some iPhone and iPad models and has requested that China stop manufacturing and selling iPhones.

Related Roundup: iPhone X
Buyer's Guide: iPhone X (Buy Now)

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Creator of ‘Remotizer’ Keyless Entry System Sues Apple for Selling HomeKit-Enabled August Smart Lock

Texas resident Mark Kilbourne has filed a lawsuit against Apple in Southern Texas for selling the HomeKit-enabled August Smart Lock.


The complaint claims that the August Smart Lock infringes upon his patented Remotizer keyless entry system for existing deadbolt locks. For selling the product, Apple is somehow being solely targeted here rather than August.

Kilbourne allegedly submitted a Remotizer app for iPhone for review around September 2014, but Apple said it was unable to continue with the process because it needed the associated hardware to fully assess the app.

"We began review of the app but are not able to continue because we need the associated hardware to fully assess your app features," read Apple's email response, according to the complaint. It appears Kilbourne never complied.

Both the Remotizer and August Smart Lock are electronic systems for remotely opening and closing a preexisting deadbolt lock without a key. Both products allow homeowners to keep their existing exterior door hardware and replace only the interior side of most standard deadbolts.


August's Smart Lock is compatible with Apple's HomeKit platform for locking and unlocking with Apple's Home app and Siri.

Kilbourne is seeking an award of unspecified damages and legal costs, and he wants Apple to stop selling the August Smart Lock, according to the complaint. The lawsuit is rather humorous given that it should probably be targeted at August Smart Lock, so we'll see how far this one goes before getting tossed out.


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Apple’s Lengthy Lawsuit With Samsung Over Copying iPhone’s Design Headed Back to Court

Apple's over six year old legal battle with Samsung for copying the iPhone's design is headed back to court yet again.

U.S. District Court Judge Lucy Koh on Sunday ordered that a new trial is required to determine whether Apple's $399 million award for Samsung's design patent infringement should stand or whether a new damages trial is required.


Apple and Samsung have until Wednesday to propose a retrial date, according to intellectual property analyst Florian Mueller, but he believes there is about a 30 percent chance the two parties could settle out of court before then.

The lawsuit dates back to 2011, when Apple successfully sued Samsung for infringing upon the iPhone's patented design, including its rectangular front face with rounded edges and grid of colorful icons on a black screen.

Apple's damages were awarded based on Samsung's entire profit from the sale of its infringing smartphones, but Samsung argued that the amount should be a percentage based on individual components like the front bezel or display.

Last December, the U.S. Supreme Court recommended that the U.S. Court of Appeals reconsider the damages amount that Samsung owes.

Apple's statement at the time:
The question before the Supreme Court was how to calculate the amount Samsung should pay for their copying. Our case has always been about Samsung's blatant copying of our ideas, and that was never in dispute. We will continue to protect the years of hard work that has made iPhone the world's most innovative and beloved product. We remain optimistic that the lower courts will again send a powerful signal that stealing isn't right.
Calvin Klein, Dieter Rams, and over 100 other top designers backed Apple last year, arguing the iPhone maker is entitled to all profits Samsung has earned from infringing designs. They cited a 1949 study stating that more than 99 percent of Americans could identify a bottle of Coca-Cola by shape alone.

Apple was initially awarded nearly $1 billion in damages, but a significant part of the decision was reversed in 2015, leaving Samsung owing $548 million. The amount was eventually lowered to $399 million in subsequent retrials.


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Amazon Sending New Round of Credits to E-Book Buyers as Part of Apple Price Fixing Settlement

Customers who purchased a Kindle e-book between April 1, 2010 and May 21, 2012 may be receiving a credit from Amazon this morning as the retailer continues distributing funds from an antitrust lawsuit levied against Apple back in 2013 by the United States Justice Department.

Emails were sent out to eligible customers in the United States this morning, and Amazon has also set up a website that will list available credits for those who are eligible for a refund.

Apple, along with five other publishers including HarperCollins, Simon and Schuster, Hachette Book Group, Macmillan, and Penguin, was found guilty of conspiring to inflate the prices of e-books to weaken Amazon's dominant position in the market. While the five publishers settled, Apple held out and appealed several times, but was ultimately ordered to pay a total of $450 million.

Apple maintained its innocence throughout the initial trial and appeals, and has argued that its deals with publishers introduced competition to a market that was largely controlled by Amazon. The United States Justice Department did not see it that way, though, as Apple's efforts ultimately raised prices for consumers.


Several rounds of refunds have already been distributed as a result of the lawsuit. In 2014, customers received refunds funded by publishers, and in 2016, refunds totaling $400 million, or the bulk of the money paid by Apple, were sent out. This new round of refunds has also been funded by Apple's settlement and comes from $20 million that was earmarked to pay states that were involved in the lawsuit.

Credits sent out today will last for six months and will need to be spent by April 20, 2018.

Update: Customers are also receiving notices about available Apple credits that are also being distributed today. Credits are being added to Apple accounts automatically and can be used in iBooks, iTunes, and the App Store.


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New Article Delves Into Origins of Ongoing Legal Feud Between Apple and Qualcomm

A new in-depth story about the ongoing legal fight between Apple and Qualcomm has been posted online today by Bloomberg Businessweek, going behind the scenes of the accusations and rebuttals made by the two tech companies. The fight centers upon the "Qualcomm tax," or the amount of money that Qualcomm charges smartphone makers for the internal components of a device that allows it to connect to a cellular signal, also known as the smartphone's modem.

According to court documents seen by Bloomberg Businessweek, the true origin of the feud is described as starting two summers ago at the Allen & Co. conference in Sun Valley, Idaho. There, Apple CEO Tim Cook and Samsung Vice Chairman Jay Y. Lee are believed to have "shared a quiet word," where Cook told Lee to "pressure" South Korean antitrust regulators into intensifying a Qualcomm investigation that had been open for about a year at the time.


Apple wanted to get itself in front of investigators and spur more questions about the Qualcomm tax, which it could do because it was in an agreement with the modem supplier. That deal had lowered the tax from $30 to about $10 per iPhone, with Apple promising not to challenge any of Qualcomm's patents. However, it meant that Apple could truthfully answer any question in an investigation about the supplier that was already under way -- which Qualcomm claims was exactly Apple's intent at the Idaho conference.
Qualcomm claims that at the event—almost certainly the Allen & Co. conference in Sun Valley, which both Cook and Lee attended—the Apple executive urged Samsung to pressure South Korean antitrust regulators to intensify an investigation into Qualcomm that had been open since 2014. “Get aggressive,” the Apple executive said, according to Qualcomm's filing, adding that this would be the “best chance” to get Qualcomm to lower its prices.

Apple says nothing improper happened. “I don’t know what conversation they are talking about,” says Bruce Sewell, the company’s general counsel, in an interview at headquarters in Cupertino, Calif. “For Apple to have said to Samsung, ‘You guys are in Korea and you should be watching this case carefully,’ doesn’t seem to me to be anything beyond simply the kind of conversation two CEOs might have.”
The story then details a few other parts of Qualcomm's history, including its massive "Patent Wall" that greets visitors to its headquarters, displaying patents for Qualcomm's CDMA specification and others that the company claims to be for the first smartphone and app store. "I can't think of a keystroke that you can do on a phone that probably doesn't touch a Qualcomm invention," said CEO Steve Mollenkopf.

Apple was reliant on Qualcomm for this reason for many years, as it produced the highest quality modems in the supply chain and forced the Cupertino company to deal with the Qualcomm tax. That changed in 2015 when Intel began producing modems that would arrive in the iPhone 7. According to Apple general counsel Bruce Sewell, "What prompted us to bring the case now as opposed to five years ago is simple, it's the availability of a second source."

This introduction of a quality second source in the modem supply chain was met with another point by Apple: a smartphone modem is simply one of many components that make up an iPhone — and of "no special significance" as modern consumers rely less on the actual cellular features of the device. These two points encouraged Apple's decision to fight back against Qualcomm, ultimately leading to Apple's lawsuit earlier this year, a Qualcomm countersuit soon after, and more companies joining Apple in its fight.
“Cellular connectivity is important,” he says, “but it’s not as important as it used to be.” On another table behind Sewell, an Apple representative has laid out two versions of the iPhone 7: One model, which has 128 gigabytes of memory was sold by Apple for $750. The other, which has 256 GB, sold for $100 more. How is it fair, Apple asks, for Qualcomm to charge as much as $5 more for the technology in the more expensive phone, given that the two devices are otherwise identical?
In July, Qualcomm claimed that Apple infringed on six of its new patents concerning battery life and graphics processing in smartphones, and in August the U.S. International Trade Commission opened an investigation into Apple's alleged infringement with a decision date aimed around the time of the September 2018 iPhone launch. The patent infringement accusation is said to be designed to disrupt Apple's supply chain and "push the company to negotiate," with Qualcomm CEO Mollenkopf stating that all of the legal back-and-forth won't last forever, expecting Apple to settle soon.

That won't happen according to Sewell: "There's no way that this case settles, absent a complete reinvention of the licensing model that Qualcomm has adapted in the industry."

Check out the fully story by Bloomberg Businessweek right here.


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Apple Denied Motion to Dismiss Lawsuit Related to Disabling FaceTime on iOS 6 and Earlier

United States district judge Lucy Koh has denied Apple's motion to dismiss a lawsuit related to disabling FaceTime on iOS 6 and earlier software versions three years ago, allowing the case to proceed as a class action lawsuit. MacRumors obtained court documents of the opinion filed electronically.


The lawsuit was filed in February by California resident and iPhone 4 owner Christina Grace, who claims Apple intentionally broke FaceTime on iOS 6 and earlier by disabling a digital certificate that caused the service to cease functioning. California resident Ken Patter was later named as a second plaintiff.

FaceTime abruptly stopped functioning for all iOS 6 users in April 2014. At the time, a spokesperson for Apple said devices may have encountered a "bug" resulting from a device certificate that expired on that date, and the company advised affected users to update to iOS 7 to fix the issue.

The lawsuit, however, alleges that Apple intentionally broke FaceTime, prioritizing its financial interests over its customers.

Apple used two connection methods when launching FaceTime in 2010: a peer-to-peer method that created a direct connection between two iPhones, allegedly used between 90 and 95 percent of the time, and a relay method that used data servers from content delivery network company Akamai Technologies.

Apple's peer-to-peer FaceTime technology was found to infringe on VirnetX's patents in 2012, however, so the company began to shift toward the relay method, which used Akamai's servers. Within a year, Apple was paying $50 million in fees to Akamai, according to testimony from the VirnetX trial.

Apple eventually solved the problem by creating new peer-to-peer technology that would debut in iOS 7 in September 2013. But not all users upgraded and, seven months later, the lawsuit alleges that Apple intentionally broke FaceTime on iOS 6 and earlier to stop paying millions per month to Akamai.

Testimony from Apple's 2016 retrial with VirnetX indicated that, between April 2013 and September 2013 alone, Apple paid approximately $50 million as a result of FaceTime functioning in relay mode only on iOS 6 and earlier.

Updating to iOS 7 could be seen as the simple solution in this situation. But the plaintiffs owned an iPhone 4 and iPhone 4s, and cited internet articles that claim updating to iOS 7 significantly impairs the performance and functionality of those smartphones. Their complaint also cited Bluetooth and Wi-Fi issues.

In its now-denied motion to dismiss, one of Apple's arguments was that the plaintiffs have no right to uninterrupted, continuous, or error-free FaceTime service under the terms of its iOS Software License Agreement. Apple also said the plaintiffs didn't experience the iOS 7 issues mentioned on their own iPhones.

The class action lawsuit would apply to all iPhone 4 or iPhone 4s owners in the United States who, on April 16, 2014, had iOS 6 or an earlier version of the operating system installed on that device. The plaintiffs claim Apple's actions violate California's Unfair Competition Law and are seeking a jury trial.


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Florida Company Sues Apple, Says Apple TV’s ‘What Did He Say?’ Feature Copies Its Movie Software

Florida company CustomPlay filed a patent infringement lawsuit against Apple today, claiming the fourth-generation Apple TV's rewind with closed captioning tvOS feature copies its movie companion software.


Using the Siri Remote, Apple TV users can ask "what did she say?" and tvOS will rewind the TV show or movie by 10-15 seconds and resume playing with closed captioning temporarily enabled.

Skip to roughly the 1:02:13 mark of Apple's September 2015 event video below to see a live demo of the feature.

Skip to roughly the 1:02:13 mark of the video

CustomPlay owner Max Abecassis essentially argues he invented the idea first, based on U.S. Patent No. 6,408,128 B1, filed in 1998 and granted in 2002. A relevant excerpt from the patent's description:
A remote control capable of activating a replay function comprises a WHAT? button, key, or other replay function key or means, to enable a viewer by activating the replay function to automatically cause the system to: i) rewind or skip backwards the playing of the video a system default or a viewer specific previously defined amount, e.g. 20 seconds; ii) turn on the subtitle to a system default or a viewer specific previously selected subtitle language, e.g. English; iii) turn off the subtitle at either the point the WHAT? button was pressed or at some viewer specific previously defined point with respect to the time at which the WHAT? button was pressed, e.g. five seconds prior to, or after, the point the WHAT? button was pressed; and iv) increase the audio/dialog volume during the segment replayed.
In its complaint, filed with the U.S. District Court for the Southern District of Florida, CustomPlay says it has software that uses the patent available for download on its website. The company's homepage lists apps such as PopcornTrivia and CustomPlay, each available on the App Store for iPhone.

For one app, named One Screen, CustomPlay describes a "What?" feature that does sound similar to the Apple TV's feature.
The What? function rewinds the movie a user-defined amount of time, e.g. 20 seconds, and continues playback with the subtitles automatically enabled only during the replayed portion.
One Screen, however, is the only app listed as "coming soon" on CustomPlay's website. The company still intends to make the software available to end users, according to its complaint. It's unclear if similar functionality is included in its PopcornTrivia and CustomPlay apps, or in its DVD software for PCs.

CustomPlay's so-called "What"? feature

CustomPlay says it contacted Apple about the potential for an exclusive business relationship in 2014. The company believes Apple is aware of its patent and, without a license, proceeded to implement its patented technology in its tvOS operating system for the latest Apple TV model, launched October 2015.

Court documents obtained by MacRumors show CustomPlay seemingly mailed letters to Apple CEO Tim Cook and three iTunes executives in July 2014, and Abecassis sent a few follow-up emails to Cook later in the year, but it's unclear if Apple responded. There is no indication of Apple responding at the very least.

Apple has an unsolicited idea submission policy to prevent potential misunderstandings or disputes when the company's products or strategies might seem similar to ideas it has received, but it's unclear if it would apply in this situation, and it does not automatically excuse Apple from patent infringement.

CustomPlay's website says it is affiliated with Nissim Corporation, which appears to be a non-practicing entity, also owned by Abecassis. Nissim sued Apple last September for allegedly infringing upon seven patents related to DVD specifications. The two companies reached an unknown settlement in December.

Nissim's website says it has brought lawsuits against major companies such as Apple, Paramount Pictures, Time Warner, and 20th Century Fox Home Entertainment. All of those companies, excluding Apple, are also listed as Nissim's licensees, alongside Acer, Bose, Dell, HP, Lenovo, LG, Microsoft, Sony, and others.

CustomPlay is seeking damages of an undetermined amount from Apple, plus legal costs, and it has requested a jury trial.

Related Roundups: Apple TV, tvOS 10
Tag: lawsuit
Buyer's Guide: Apple TV (Don't Buy)

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Apple Ordered to Pay $506M to University of Wisconsin in A7/A8 Patent Dispute

U.S. District Judge William Conley today ordered Apple to pay $506 million to the University of Wisconsin's Alumni Research Foundation for infringing on a patent related to computer processing technology used in its A7, A8, and A8X chips, reports Reuters.

The $506 million total is nearly double the $234 million in damages that a Jury ordered Apple to pay back in 2015, with Conley adding an extra $272 million. According to Conley, Apple owes additional damages along with interest because Apple continued to infringe on the patent until it expired at the end of 2016.

The lawsuit in question dates back to 2014, when the Wisconsin Alumni Research Foundation accused Apple of infringing on a patent titled "Table based data speculation circuit for parallel processing computer," that was originally granted in 1998 and covers a method for improving processor efficiency.

A jury ruled that Apple's A7, A8, and A8X processors infringe on the patent, and the university has also filed a second lawsuit covering Apple's A9 chips, which has not yet been ruled on.

Apple plans to appeal the judge's decision.


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Qualcomm Says Tech Group Supporting Apple is ‘Misdirecting’ ITC With ‘Coordinated Effort’

Last week, the Computer & Communications Industry Association, a lobbying group representing Google, eBay, Amazon, Microsoft, Netflix, Intel, Samsung, and other tech companies, asked the United States International Trade Commission to reject Qualcomm's request for an import ban on some of Apple's iPhone and iPad models that use Intel chips.

The group said that banning Apple products that use Intel chips would enable Qualcomm's anti-competitive behavior and cause supply issues, resulting in harm to consumers.


Qualcomm today responded to the CCIA in a court filing, accusing the group of launching a "coordinated effort aimed at misdirecting" the ITC, reports Reuters. Qualcomm also said that the import ban it requested is not focused on Intel's chips, but the patented technology used in iPhones with Intel chips.
In its filing on Monday, Qualcomm argued that its import ban is not actually about Intel's chips, but instead concerns the patented technology that surrounds the Intel chips in current versions of the iPhone. Thus a ban on importing the phones would not hurt competition in the long term, Qualcomm argued. "Apple can purchase and utilize any LTE modem it chooses so long as it does not infringe Qualcomm's asserted patents," the company wrote.
Apple and Qualcomm have been embroiled in an ongoing legal battle following Apple's decision to sue Qualcomm in January for charging unfair royalties and refusing to pay quarterly rebates.

The fight between the two companies has escalated since then, most recently leading Qualcomm to file a patent infringement lawsuit against Apple and request an import ban for some iPhone models.

In a statement to Reuters on Qualcomm's filing this afternoon, Apple once again complained that Qualcomm makes a single chip in the iPhone but "for years [has] been demanding a percentage of the total cost of [Apple] products - effectively taxing Apple's innovation."


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