Qualcomm (QCOM.US) wins chip licensing battle: Arm (ARM.US) seeks reconsideration

On Friday, Qualcomm (QCOM.US) won a lawsuit against chip design company Arm (ARM.US). Previously, Arm accused Qualcomm of acquiring and using Arm's technology through the acquisition of a chip startup, which violated the chip technology licensing agreement. The jury in the Delaware federal court ruled that Qualcomm did not violate the agreement by integrating Arm chip products into its own chips without paying higher licensing fees. The agreement covered Arm chip products that Qualcomm acquired through the $1.4 billion purchase of Nuvia in 2021. The jury could not reach a consensus on whether Nuvia violated the licensing agreement, and Judge Maryellen Noreika indicated that this issue may be retried at a later date. Qualcomm is one of Arm's largest customers and long-term partners, but as the two companies have become competitors in the computer processor industry, their disagreements have grown. This dispute is significant because many large tech companies around the world rely on Arm's licensed chip architecture, which is integrated into Qualcomm's products across various fields including computers and automobiles. Arm stated that they intend to seek a retrial. "We are disappointed that the jury did not reach a consensus on the claims," the company said in a statement. The jury initially informed the judge on Friday that they were deadlocked during deliberations on the second day. After Noreika instructed the eight-person panel to continue working towards a unanimous decision, the jury made rulings on two out of the three charges. In a statement, Qualcomm said, "The jury has validated Qualcomms innovation rights and confirmed that all Qualcomm products involved in this case are protected under Qualcomm's contract with Arm." Arm claimed that Qualcomm should have renegotiated the agreement after acquiring Nuvia, and requested that the San Diego-based company destroy the designs obtained through the acquisition. Qualcomm entered the computer processor market relying on Nuvia's technology, arguing to the jurors that the company holds a separate, broad licensing agreement covering Arm innovations applicable to its products.