March 30, 2006

Qualcomm announced yesterday it filed a patent infringement suit against chipmaker Broadcom, the third in a running dispute over what Qualcomm alleges is misuse of its intellectual property.

The latest suit focuses on what Qualcomm charges is Broadcom’s misappropriation of trade secrets relating to W-CDMA chipsets and the multimedia functionality the chipsets enable. W-CDMA is the 3G air interface for the GSM technology path.

Broadcom asserted that Qualcomm actually is infringing on Broadcom patents.

“We believe that Qualcomm’s current and next-generation cellular baseband and radio frequency products infringe on a number of our patents,” said Bill Blanning, vice president of corporate communications at Broadcom, in an e-mail message.

He called Qualcomm’s claims “meritless” and said that the latest suit had not been brought to his company’s attention before being filed in court.

Blanning said that his company’s litigation on patent infringement by Qualcomm began in May 2005 with complaints with the International Trade Commission and in United States District Court, plus antitrust complaints in both the U.S. and Europe.

“We don’t expect this latest Qualcomm claim to materially change the litigation landscape,” Blanning said.

The patent infringement allegations charge that Broadcom is infringing on a Qualcomm patent by manufacturing and selling W-CDMA and wireless local area network chipsets.

The suit, filed in federal court in San Diego, requests an injunction barring Broadcom’s continued use of Qualcomm’s intellectual property and seeks monetary damages.

A trial in the first of Qualcomm’s suits against Broadcom is currently scheduled to begin in January.

The latest thrust by Qualcomm comes on the heels of Broadcom’s and other’s complaints that Qualcomm is stifling competition through its licensing requirements for W-CDMA.

Last fall, major wireless players including Nokia Corp., L.M. Ericsson and Texas Instruments Inc. joined Broadcom in an antitrust complaint with the European Union against Qualcomm.

Those companies alleged that Qualcomm’s licensing requirements for W-CDMA hurt competition in the industry by driving up the costs of 3G handsets.

Qualcomm believes the complaint is without merit, according to its general counsel in an interview with CIBC World Markets.

The company suggested it might officially respond to the complaint in late April, which would initiate the EU’s review of the complaint’s merit.

Source: RCR