U.S. District Court Judge James V. Selna has ordered Qualcomm to cease the production, use, sale, and importation of certain chips that infringe on three Broadcom patents. The patents pertain to video encoding, push-to-talk, and 3G technologies for cellular handsets.
“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,” said Broadcom General Counsel David Dull.
For its part, Qualcomm said it is reviewing the ban and expects it will require further clarification from the court on various aspects of the ruling.
Qualcomm Plans
“We are disappointed with the order and will continue to pursue all available legal avenues, including the appeal process,” said Qualcomm CEO Paul Jacobs during a conference call with investors.
“Out of an abundance of caution as we continue to analyze the order,” Jacobs added, “we have decided to take a number of immediate measures to ensure compliance.”
As one countermeasure, Qualcomm has begun sampling new “drop-in replacement” chipsets that are compatible with the company’s infringing products. “We expect that our OEMs will be able to transition over to the new chipset and we expect commercial handsets to be available by the end of the first quarter,” said Sanjay Jha, chief operating officer of Qualcomm CDMA Technologies.
Qualcomm’s CEO admitted that Judge Selna’s decision is likely have a negative impact on the company’s sales in the short term due to the time required for handset customers to make the transition to the company’s new designs. The court’s decision is expected to impact certain Qualcomm products already in the development pipeline for the U.S. market, Jacobs said.
Sunset Provision
In the long run, Qualcomm will be challenged to make replacement components commercially available prior to January 31, 2009 — the expiration date of the sunset provision…