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Qualcomm claimed victory against Arm on Friday in a long-running dispute over its 2021 acquisition of semiconductor company Nubia, after a U.S. jury ruled largely in Arm’s favor.
But Mr. Arm vowed to seek a new trial, citing a so-called “deadlock” after jurors could not reach a conclusion on one of the three questions they were asked to answer, leaving the door open for further lawsuits and settlements. We laid the foundation for this.
After a jury returned a partial verdict on Friday, the federal judge in Delaware overseeing the case directed Arm and Qualcomm to speak with an arbitrator.
Arm’s lawsuit alleges that Qualcomm violated its chip design license when it acquired Nuvia. The company filed a lawsuit against one of its largest customers in 2022, calling it a last resort to protect its intellectual property.
The jury will decide whether Nuvia violated the license it had with Arm, whether Qualcomm violated Nuvia’s license with Arm, and whether Qualcomm’s license covered the chip technology that Arm was contesting. They were asked to answer three questions:
The jury found in favor of Qualcomm on the second and third questions, but could not reach a verdict on whether Nuvia violated its license with Arm.
Qualcomm said it was satisfied with the ruling. The jury said it “vindicated Qualcomm’s right to innovation” and found that the products at issue in the case are protected by its existing contract with Arm.
Arm said he would seek a new trial based on the fact that the jury was “unable to reach agreement on the totality of the allegations.”
“From the beginning, our top priority has been to protect Arm’s intellectual property and the unparalleled ecosystem we have built with our valued partners for more than 30 years,” the company added.
The failure of two of the world’s largest semiconductor companies to reach a settlement before the case went to trial surprised analysts.
“Qualcomm clearly came out on top,” said Prakash Sangam, founder and principal analyst at technology consultancy Tantra Analyst, who was present during the trial. “Two of the three questions resulted in a unanimous verdict in their favor, and the judge made it clear she was not keen on a speedy retrial.”
The dispute threatened to cause widespread disruption as a range of new artificial intelligence-focused consumer devices powered by Qualcomm chips are coming to market, including PCs from Microsoft and Dell and smartphones from Samsung. . Arm was attempting to destroy the allegedly infringing products.
Arm and Qualcomm have historically partnered, with the British group providing the architecture for the American company to build chips. The legal dispute between the two parties began with Qualcomm’s $1.4 billion acquisition of chip startup Nuvia in 2021.
Arm accused Qualcomm of using intellectual property it licensed to Nuvia and said it failed in its contractual obligation to secure Nuvia’s consent to reassign its own Arm license.
Qualcomm argued that its license with Arm covered the disputed technology and that Arm was milking it for higher royalties. Arm CEO Rene Haas and Qualcomm CEO Cristiano Amon testified this week in a jury trial that began Monday.
The case ended years of tension between the companies over the millions of dollars Qualcomm pays Arm each year in royalties for its chip designs. This caused a severe rift in their relationship.
Arm has presented evidence suggesting that Qualcomm calculates that acquiring Nuvia could save British companies hundreds of millions of dollars in annual license fees.
When Qualcomm entered the PC market, it aimed to reduce Arm’s reliance on off-the-shelf designs and design custom chip “cores” in-house. This is factored into the $1.4 billion price tag Qualcomm is willing to pay for Nuvia, according to internal documents shown to the jury.
Qualcomm, on the other hand, cited Haas’ close relationship with SoftBank CEO Masayoshi Son and their close discussions over the company’s plans to increase royalty income after the Japanese group’s acquisition of Arm in 2016. provided evidence of a relationship.
