A federal judge has barred Qualcomm from selling three multimedia EV-DO chips that infringe on Broadcom patents. A "sunset provision," allows Qualcomm to continue selling older versions of the same products through January 2009, as long as Qualcomm pays Broadcom up to 6% royalties
According to a Broadcom Press Release:
Broadcom Corporation (NASDAQ: BRCM) , a , announced that a federal judge today issued an injunction against Qualcomm Incorporated's continued infringement of three Broadcom patents.
"We are very pleased with today's ruling, which addresses Qualcomm's improper use of our patented technology covering cellular chips and software for advanced consumer devices," said David A. Dull, Broadcom's Senior Vice President and General Counsel. "Broadcom should not have to compete against companies that use Broadcom's own patented technology against us, and this injunction puts a stop to Qualcomm doing just that."
As ordered by U.S. District Court Judge James V. Selna, the injunction prohibits Qualcomm from making, using and selling certain chipsets and software that infringe the three Broadcom patents. The injunction, effective today, also prohibits Qualcomm from engaging in a broad range of additional activities. According to the terms of the injunction, Qualcomm is prohibited, for example, from advertising, marketing or otherwise promoting; entering or fulfilling product orders; setting, determining or approving terms of sale; providing customer service or technical support; negotiating or entering into licensing, representative, reseller or distributor agreements; developing, designing or manufacturing; writing, modifying or updating software; developing or modifying circuits; writing, modifying or updating hardware description code language; or taping out or preparing documentation for, infringing products.
Qualcomm's release stated:
Qualcomm Incorporated announced that Federal District Judge James V. Selna has issued an injunction against certain Qualcomm products for the United States market that were found to infringe three Broadcom patents. Qualcomm is reviewing the complex ruling and expects it will require further clarification from the court on various aspects of the ruling, including the effect of Verizon Wireless' existing license agreement with Broadcom.
The ruling provides a "sunset" provision that stays the order until Jan. 31, 2009 for QChat and 1x/EV-DO products that were found to infringe any of the three patents by providing Qualcomm a limited license, subject to an ongoing royalty payment. This license is limited to products that were sold to customers on or before the jury verdict was delivered on May 29, 2007. The '010 and '317 patents apply only to Qualcomm's QChat and 1x/EV-DO products. Qualcomm is continuing the development of work-around solutions for the '010 and '317 patents.
The order imposes an immediate injunction on WCDMA products for the U.S. market that were found to infringe the '686 video encoding patent. Qualcomm today announced the availability of new chips that have already been sampled to customers and expects to have hardware and software work-arounds to the '686 patent commercially available in handsets before the end of the first calendar quarter of 2008.
While Qualcomm will attempt to obtain further relief and clarity from the courts on certain aspects of the order, the inability to obtain such relief will likely have an immediate, short-term impact as handset customers transition to new designs for WCDMA products relating to the '686 patent, medium-term impact to certain products in the development pipeline for the U.S. market, and longer-term ability to implement work-arounds in time for commercial availability of handsets by the January 2009 sunset expiration.
Qualcomm is evaluating all of its options, including seeking appropriate stays and appeals and will comply with all directives and orders of the court. The United States Patent Office has also instituted a reexamination of the validity of the '317 patent claims.