Qualcomm ends patent licensing spat with LG, signs five-year deal

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Qualcomm has inked a new patent licensing deal with South Korean electronics giant LG on terms consistent with other Qualcomm patent agreements globally.

The five-year license covers 3G, 4G and 5G smartphones and other complete devices, according to Qualcomm. The San Diego company did not reveal further details on Tuesday, including the royalty rate.

The deal comes after negotiations appeared to be stalled following a court brief that LG filed in June supporting anti-trust sanctions against Qualcomm.

Those sanctions call for sweeping changes in the way Qualcomm licenses its mobile patents – essentially laying the foundation for patent royalties based on the price of smartphone chips rather than the complete device.

LG's previous license for Qualcomm's patents expired at the end of 2018. The two firms were negotiating when a Northern California ruled in May that Qualcomm's royalty rates were unreasonably high and its business practices around licensing violated anti-trust laws.

When Qualcomm sought to put remedies on hold pending appeal, LG argued that any delay would weaken LG's efforts to negotiate a fair royalty and extend Qualcomm's monopoly power into the 5G market.

The judge agreed, denying Qualcomm's request to delay implementation of the remedies.

Qualcomm is now asking the U.S. 9th Circuit Court of Appeals to put the sanctions on hold. A three-judge panel has yet to rule.

Qualcomm is a leader in 5G technologies. It supplies silicon for LG's V50 ThinQ 5G smartphone. A second 5G handset from LG is expected to be announced before year end. Without an agreement, LG could have risked falling behind in the 5G race.

To date, Qualcomm's 5G chips have been designed into 150 smartphones and mobile hotspots either on the market or in the pipeline

"This agreement builds on our long-standing technology relationship and reaffirms the value of Qualcomm's world-class patent portfolio,"

John Han, senior vice president of Qualcomm Technology Licensing, said in a statement. "Qualcomm is the developer and enabler of foundational technologies for the wireless industry and is the leader in the transition to 5G."

5G also helped spark a settlement earlier this year in Qualcomm's bitter, two-year legal war with Apple. The two companies in April signed a six-year license and multi-year chip supply deal that's expected to pave the way for a 5G iPhone in 2020.

©2019 The San Diego Union-Tribune
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