Qualcomm Wins Legal Dispute Over Arm Chip License.
The jury issued a split verdict in favor of Qualcomm.
A federal jury in Delaware ruled on Friday that Qualcomm did not violate its agreement with Arm regarding the acquisition of Nuvia, a startup founded by three former Apple engineers in 2021. This decision is the result of a legal dispute that has lasted two years, in which Qualcomm was accused of improperly using chip designs that Arm had authorized for Nuvia prior to the purchase.
Despite this victory for Qualcomm, the jury could not determine whether Nuvia had breached its agreement with Arm, meaning the case could be retried. U.S. District Judge Maryellen Noreika remarked that "I don't believe either party has had a clear victory, nor would it have had if the case were retried."
Qualcomm acquired Nuvia for $1.4 billion with the aim of enhancing its next-generation chip portfolio, such as the Snapdragon X used in current Copilot Plus laptops. However, during the trial, it was revealed that internal Qualcomm documents suggested that the company could save up to $1.4 billion annually in payments to Arm.
The legal battle began in 2022, when Arm accused Qualcomm of continuing to pay royalty fees that were allegedly much lower than those Nuvia was paying. As they failed to reach an agreement, Arm argued that the designs licensed to Nuvia were no longer valid and demanded that Qualcomm destroy the technology developed using them.
In a recent interview, Arm's CEO, Rene Haas, could not provide many details about the trial but stated that "the principles on which we filed the lawsuit remain unchanged." Ultimately, the jury ruled in favor of Qualcomm after reviewing internal Arm documents estimating a loss of $50 million in revenue due to the acquisition of Nuvia. Additionally, Gerard Williams, co-founder of Nuvia, testified that his startup used "one percent or less" of Arm's technology in its final product.
Ann Chaplin, General Counsel and Corporate Secretary of Qualcomm, stated in a press release that "the jury has vindicated Qualcomm's right to innovate and affirmed that all of Qualcomm's products in question are protected by Qualcomm's contract with Arm." She also added that the company will continue to develop leading performance products that benefit consumers globally, including its innovative Oryon custom CPUs compatible with ARM.
