Chips tech firm Arm sues Qualcomm and Nuvia for breach of license and trademark

Qualcomm logo is during Munich Auto Show, IAA Mobility 2021 in Munich, Germany, September 8, 2021. REUTERS/Wolfgang Rattay

SAN FRANCISCO, Aug 31 (Reuters) – Chip technology firm Arm Ltd, which is owned by Softbank Group Corp (9984.T), said on Wednesday it has sued Qualcomm Inc (QCOM.O) and Qualcomm’s recently acquired chip design firm Nuvia Inc for breach of license agreements and trademark infringement.

Arm is seeking an injunction that would require Qualcomm to destroy the designs developed under Nuvia’s license agreements with Arm, which Arm said could not be transferred to Qualcomm without Arm approval. Qualcomm acquired Nuvia for $1.4 billion last year. read more

Qualcomm did not immediately respond to a request for comment.

The lawsuit represents a major break between Qualcomm and Arm, one of its most important technology partners that Qualcomm relied on for years after Qualcomm stopped work on designing its own custom computing cores.

But the two companies have been at odds for years, with some inside Qualcomm complaining privately that Arm’s slackening pace of innovation is causing Qualcomm’s chips to fall behind Apple’s processors in performance.

Qualcomm bought Nuvia – a firm founded by former Apple chip architects – to reboot its efforts to make custom computing cores that would be different from standard Arm designs used by rivals such as Taiwan chip designer MediaTek Inc. (2454.TW).

It said at the time it planned to use the new technology for its smartphone, laptop and automotive processors. The deal marked a big push by Qualcomm to reestablish a leading position in chip performance after several years of high-profile patent licensing litigation with rival Apple and regulatory authorities.

While Qualcomm and Apple have resolved disputes over Qualcomm’s patent royalties, Nuvia executives and Apple have been at loggerheads. In 2019, Apple sued Nuvia’s Chief Executive Gerard Williams III, alleging Williams recruited Apple employees to Nuvia while he was still employed at Apple. Apple did not sue Nuvia itself, nor did it allege any intellectual property theft.

The deal was seen as a way for Qualcomm to lessen its reliance on Arm. Most of Qualcomm’s chips have used computing cores licensed directly from Arm, while Nuvia’s cores use Arm’s underlying architecture but are custom designs.

For Qualcomm, using more custom core designs – a move that Apple has also made – could lower some licensing costs to Arm in the short term and make it easier to move to a rival architecture in the longer term.

Reporting By Jane Lanhee Lee and Stephen Ellis Editing by Nick Zieminski

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