ITC Judge says Apple infringed on one Qualcomm patent, but he will not ban U.S. iPhone imports

A U.S. International Trade Commission judge ruled today that the Apple iPhone infringed on one of a trio of Qualcomm patents. But even with that in mind, Judge Thomas Pender said that banning U.S. imports of the iPhone would be against the public interest. That comment mirrors a statement made by ITC staff nearly two weeks ago. At that time, these staff members said that banning imports of the iPhone in the states would negatively impact competition in the modem chip market. Apple isn't completely off the hook as far as an import ban is concerned. The full commission must review Judge Pender's ruling and it is the entire ITC that has the last word in this matter.

Both Apple and Qualcomm have been taking each other to court over various matters. One issue brought up by Apple is whether Qualcomm's royalty fees on its standard-essential patents are too high. These are patents that are essential in the production of a product, like a smartphone. Patents so designated are supposed to be licensed in a Fair, Reasonable, and Non-Discriminatory manner (FRAND). On its part, Qualcomm says that Apple had directed its suppliers to stop paying royalties to Qualcomm, and the amount of these unpaid royalties range from $2.5 billion to $4.5 billion according to Matt Larson of Bloomberg Intelligence.

Apple argues that blocking imports of the Intel powered iPhone into the U.S. will halt the competition between Intel and Qualcomm that is necessary for the development of 5G. Qualcomm says that blocking imports of the iPhone into the U.S. will ultimately put pressure on Apple to make sure that Qualcomm gets paid the money it is owed by Apple's suppliers.

From 2011-2015, Apple used Qualcomm modem chips on the iPhone on an exclusive basis. In 2016 and 2017, both Qualcomm and Intel supplied modem chips to Apple. That changed this year when the latest trio of iPhone models was unveiled earlier this month. The iPhone XS, iPhone XS Max and iPhone XR are all equipped with an Intel modem chip, and that could continue next year. By 2020, Apple could be ready to debut 5G connectivity for the iPhone using modem chips designed by Apple itself.

source: Bloomberg