ITC Will Investigate Qualcomm's Allegations Against Apple

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Qualcomm alleges that it has six patents developed in the past four years that improve battery life in mobile devices and that 'Apple uses these technologies in its devices but is not paying for them'.

SAN DIEGO - August 8, 2017 - Qualcomm Incorporated (Nasdaq: QCOM) today announced that the United States International Trade Commission (ITC) has commenced an investigation into Apple Inc. Hence, Qualcomm is asking for a ban on all the iPhones that have Intel modems inside, which are those running on the AT&T and T-Mobile networks. Some models of iPhone 7 use an Intel modem rather than a Qualcomm one, and while Qualcomm does not claim that the modem itself violates any patents, Apple's implementation of that modem reportedly does.

Apple responded to Qualcomm's claims of six infringements and demand for ban on foreign-made Apple devices, saying the company had tried to negotiate before suing and that Qualcomm is abusing its position. Following the allegation in April, the iPhone maker stated that it would no longer pay any royalties to Qualcomm.

The back and forth legal battle between Qualcomm and Apple rages on, as the U.S. International Trade Commission (ITC) has voted to launch an investigation into the former's patent infringement claims against the iPhone vendor.

That outcome is seen by some as a nuclear option: Last month, as the ITC weighed whether to take up the case, a lobbying group representing Google, eBay, Amazon, Microsoft, Netflix, Intel, Samsung and others filed a brief with the Commission arguing that banning Apple products would encourage anti-competitive behavior, cause supply issues and harm consumers.

Analysts are watching the ITC case closely because the trade regulator moves more quickly than many courts and could deliver a decision ahead of the pending lawsuits. The USITC specifically said it would investigate components used in Apple's iPhone 7 as well as other devices. While there is no specific timing in place, the ITC is hoping to finish up its investigation in 45 days after its start.

As of now, there have been no new comments from Apple on the matter, and when asked by Reuters, Apple reiterated the comments earlier made by CEO Tim Cook, who stated that Qualcomm had not yet provided "fair and reasonable" licensing terms for its technology. Year to date, the stock is up more than 38%, while in the last year, it is up nearly 49%.

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