Broadcom slaps Qualcomm with another lawsuit

Chip maker charges wireless supplier with fraud, unfair competition

Fabless chip maker Broadcom has twisted a new legal knife into Qualcomm, by filing yet another law suit against the Code Division Multiple Access technology giant.

Broadcom charges that Qualcomm’s conduct with two standards-setting bodies amounts to misconduct -- fraud, breach of contract and unfair competition -- that violates California state law.

Broadcom’s suit, filed late Thursday, seeks “disgorgement of profits” realized by Qualcomm, restitution, and both compensatory and punitive damages. The chip maker is also seeking an injunction barring Qualcomm from seeking to enforce specific patents against Broadcom and its customers.

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Fabless chip maker Broadcom has twisted a new legal knife into Qualcomm, by filing yet another law suit against the Code Division Multiple Access technology giant.

Broadcom charges that Qualcomm’s conduct with two standards-setting bodies amounts to misconduct -- fraud, breach of contract and unfair competition -- that violates California state law.

Broadcom’s suit, filed late Thursday, seeks “disgorgement of profits” realized by Qualcomm, restitution, and both compensatory and punitive damages. The chip maker is also seeking an injunction barring Qualcomm from seeking to enforce specific patents against Broadcom and its customers.

The lawsuit is the latest in growing number of legal battles for San Diego-based Qualcomm, which licenses the core technology for CDMA/WCDMA handsets and base stations worldwide. With characteristic aggressiveness, Qualcomm is developing a host of new technologies to extend the capabilities of the mobile broadband Internet.

Qualcomm is both an aggressor and defender in these battles. Earlier this week, Qualcomm rejected a $20 million royalty payment from Nokia, a move that ensures the increasingly bitter relicensing dispute between the two companies will continue. Nokia’s license contract with Qualcomm is due to expire this month.

Broadcom in its press release cites two examples of alleged misconduct by Qualcomm, saying it “cites numerous instances” in the 37-page complaint filed in California Superior Court in Orange County. One is based on the March 22 U.S. District Court finding by a jury that Qualcomm should have disclosed several patents related to the H.264 video compression standard to the international organization that created the standard. The same court will hold a hearing about appropriate remedies on May 2.

The second example is the June 2006 decision by the IEEE to suspend its 802.20 working group, which had been developing a wireless broadband standard. The IEEE concluded that Qualcomm had influenced the group’s deliberations improperly. Among other things, the working group chairman acknowledged he’d been a paid consultant to Qualcomm. The suspension is rare but not unprecedented.

In a statement, Broadcom’s general counsel, David Dull, said “We now know that Qualcomm has been playing games with industry-standards processes for years, leaving both consumers and competitors like Broadcom to pay a heavy price.”

Via email, a Qualcomm spokeswoman says, "Qualcomm hasn't seen the complaint from Broadcom so we can't comment at this time."

The two companies have been sparring for years. Last December, the U.S. International Trade Commission affirmed an earlier ruling that Qualcomm’s cellular baseband chips infringe on five claims of a Broadcom patent. Broadcom says a commission ruling on a remedy is due on May 8. Just a week before that, another U.S. District Court trial is due to start to try Broadcom’s claims that Qualcomm infringes three other Broadcom patents.

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