ARM loses out in Qualcomm court case, wants a re-trial
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A jury in Wilmington, Delaware, has found that Qualcomm’s latest AI-PC processors – based on the ARM instruction set – are properly licensed, say Reuters and Bloomberg reports.
The court thereby rejected ARM’s call that the intellectual property should be destroyed or that Qualcomm should be prepared to renegotiate the terms of its license with the implication of a higher royalty rate on the processors in question.
However, the jury was also deadlocked on whether Nuvia Inc., the startup acquired by Qualcomm in 2021 for US$1.4 billion, and the source of an original prototype processor design, had breached its licensing agreement with Arm.
The week-long trial therefore resulted in a mis-trial that allows Qualcomm to continue selling its Snapdragon X processors based on the Oryon core for now, but also leaves the way open for Arm to seek a re-trial.
Qualcomm’s defence was that a processor circuit design created by Nuvia was not shown to be compliant and therefore remained Nuvia’s intellectual property and could be transferred to Qualcomm as part of the acquisition.
Where the jury could not agree was whether Nuvia had breached its license agreement with ARM in not seeking approval for the acquisition.
“We are disappointed that the jury was unable to reach consensus across the claims. We intend to seek a re-trial due to the jury’s deadlock,” said an ARM spokesperson in a statement. “From the outset, our top priority has been to protect Arm’s IP and the unparalleled ecosystem we have built with our valued partners over more than 30 years. As always, we are committed to fostering innovation in our rapidly evolving market and serving our partners while advancing the future of computing.”
Judge says settle
The presiding judge, Maryellen Noreika, encouraged ARM and Qualcomm to settle their differences out of court and was quoted by Reuters saying: “I don’t think either side had a clear victory or would have a clear victory if this case is tried again.”
Nuvia was co-founded by Gerard Williams, previously a senior processor architect at tech giant and ARM architectural licensee Apple. The acquisition of Nuvia was part of Qualcomm’s strategy to enhance its CPU design capabilities and compete more effectively with Apple and others.
The Snapdragon X processors resulted from that acquisition and are a key part of Qualcomm’s plan to expand into AI-PCs using the ARM architecture Several major computer companies are incorporating Snapdragon X processors into their computers including: Acer, Dell, HP, Honor, Lenovo, Microsoft Surface, Samsung and Xiaomi.
Uncertainty remains
The court case, while apparently favoring Qualcomm, still leaves a cloud of uncertainty over Snapdragon X processors because of the potential for renewed legal action from ARM. An out-of-court settlement could resolve that. However, for ARM, the court case has cast doubt on the boundaries of its architectural licensing business model, which may mean it feels obliged to go to court to obtain clarity.
ARM licenses both fixed circuit designs, and architectural licenses that cover customers’ own circuit designs that are compliant with the architecture. The court case has exposed uncertainty around where and when an architectural license does and does not apply.
Other unfinished business may include Qualcomm’s countersuit filed against Arm asserting its right to use intellectual property transferred as part of the Nuvia acquisition. Another complication is that Arm issued a 60-day contract license termination notice to Qualcomm on October 23 that will come into force on or about December 23.
Related links and articles:
News articles:
ARM versus Qualcomm court case opens
ARM escalates Qualcomm dispute with license threat
Qualcomm hits back over ARM lawsuit
ARM sues Qualcomm over Nuvia chip designs
Qualcomm buys Nuvia to take on Apple
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