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Business litigation rages between chipmaker and smartphone giant

Oregon is the home of many high-tech companies and, as such, its courts entertain quite a bit of litigation regarding disputes relevant to such companies. One area of constant business litigation between high-tech companies involves allegations of misuse of intellectual property. For example, two giant companies battling over proprietary rights and other contractual matters have been Apple Computer and the chipmaker, Qualcomm.

The two companies have a symbiotic relationship in that Qualcomm has been a major supplier of chips for Apple's iOS devices, including iPhones. They started bickering over their respective contractual rights at the beginning of 2017 when Apple sued Qualcomm on allegations that the chipmaker was demanding unfair royalties. At or about the same time, the Federal Trade Commission brought legal action against Qualcomm on related accusations.

The FTC allegations included that Qualcomm had been engaging in monopolistic and exclusionary business activities. Qualcomm contributed to the cycle of litigation by filing an action against Apple recently in China. That suit claims that there should be a governmental ban on sales and manufacturing of Apple's iPhones in that country.

The lawsuit most recently filed by Qualcomm alleges that Apple is violating the parties' contract by refusing to allow the chipmaker to audit Apple's handling of Qualcomm's proprietary software. Qualcomm alleges that the contract gives it that right. The lawsuit also claims that Apple has taken proprietary information from the chipmaker and shared it with an Intel engineer. Intel is a competitor with Qualcomm.

Oregon sees many similar business litigation disputes in its state and federal courts. In essence, these are disputes based on a theory of breach of contract. When two companies on the scale of these two engage in such intensive litigation, the contract between the parties will become the subject of deep scrutiny by the respective attorneys and by the presiding judge. Sometimes, the meaning and application of the contract will be decided by a jury.

Source:, "Qualcomm files new suit against Apple for breach of contract", Rob LeFebvre, Nov. 2, 2017

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