Will the ITC ban imports of Apple’s iPhone into the U.S.?

“One of Apple’s key suppliers could ask a U.S. trade agency to ban imports of the popular smartphone in the U.S. as a legal spat wages on,” Chris Ciaccia reports for FoxNews.

“Qualcomm, which makes chips for the iPhone is entrenched in a legal battle with Apple after Apple decided it was going to stop paying billions in licensing fees on the chips made by Qualcomm,” Ciaccia reports. “Qualcomm is likely to ask the International Trade Commission (which describes itself as an “independent,” quasi-judicial, federal agency) to stop the iPhone — designed by Apple in California, but made in China — from entering the U.S. while the issue is ongoing, according to Bloomberg.

Ciaccia reports, “Apple claims that Qualcomm has not offered fair terms that are required for offering its patents, according to Apple CEO Timothy D. Cook.”

Read more in the full article here.

MacDailyNews Take: We don’t even need Betteridge’s law of headlines.

The answer is: No.

Qualcomm is grasping at straws.

In 2017, Qualcomm’s licensing scam — charging a percentage of the total cost of all components in the phone, even non-Qualcomm components — is unreasonable, illogical, and irrational.

SEE ALSO:
Qualcomm to seek U.S. ITC import ban for Apple iPhones – May 3, 2017
Qualcomm slashes profit forecasts as Apple ceases paying iPhone royalties – April 28, 2017
BlackBerry awarded $815 million in arbitration with Qualcomm over royalty overpayments – April 13, 2017
Qualcomm countersues Apple – April 11, 2017
Qualcomm wants FTC to drop their antitrust suit, but it doesn’t mater because Apple’s isn’t going anywhere – April 5, 2017
Apple’s dispute with Qualcomm could last two years – March 3, 2017
Apple widens global patent war, files lawsuit against Qualcomm in the United Kingdom – March 2, 2017
Apple may have paid Qualcomm $40 per iPhone; accounting for 1/3rd of Qualcomm’s revenue – February 10, 2017
Conservative groups ask President Trump to terminate FCC lawsuit over Qualcomm patent licensing – January 27, 2016
Qualcomm CEO fires back at Apple: Bring it on – January 26, 2017
Apple sues Qualcomm in China seeking 1 billion yuan – January 25, 2017
Qualcomm comments on Apple’s lawsuits in China – January 25, 2017
Apple’s rebellion against the ‘Qualcomm Tax’ – January 24, 2017
Despite lawsuit, Qualcomm wants to keep doing business – January 24, 2017
Why Apple, the FTC, and others are attacking Qualcomm’s royalty model – January 24, 2017
Here are the most damning parts of Apple’s blockbuster lawsuit against Qualcomm – January 23, 2017
Apple’s legal assault on Qualcomm part of iPhone margin grab – January 23, 2017
Qualcomm says Apple’s claims are ‘baseless’ in response to Cupertino’s $1 billion lawsuit – January 21, 2017
Apple sues Qualcomm for $1 billion over onerous licensing practices – January 20, 2017
Qualcomm exec says FTC ‘rushed’ antitrust lawsuit before President-elect Trump’s inauguration – January 19, 2017
FTC alleges Qualcomm forced Apple into iPhone LTE chip deals – January 18, 2017
FTC charges Qualcomm with monopolizing key smartphone chip; alleges extracted exclusivity from Apple in exchange for reduced patent royalties – January 17, 2017
After eating Intel’s mobile lunch, Apple could next devour Qualcomm’s Baseband Processor business – January 20, 2015
Analyst: Apple’s going to dump Intel modems if they keep lagging Qualcomm – December 5, 2016
Yes, Apple is throttling download speeds for iPhone 7 and 7 Plus Verizon and Sprint versions – November 19, 2016
Apple’s modem choices may leave Verizon iPhone users feeling throttled – November 18, 2016
Tests show iPhone 7 Plus models with Qualcomm modem perform significantly better than those with Intel modem – October 20, 2016

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

34 Comments

  1. After a somewhat lengthy and slightly contentious debate on another thread, it seems that FRAND applies. So now the courts, not me, or MDN will decide what is fair and reasonable. Heaven help either party…business lawyers and courts deciding fairness and reason.

            1. “Whenever I read an article, rather than understanding the context or looking things up myself, I will demand that other Internet users inform me! How? By demanding that they provide ‘proof’ when they state fairly well-known facts. Demanding that other people provide free labor to me – yay!” — applecynic

            2. How are you so certain it’s so obvious huh? If it was so fairly well known why didn’t someone simply say that QC admitted to doing so? No, I’m sorry. Without stating proof, it’s an assumption.

              Asking that people back up their positions is wrong? I left room on both sides of the question.

            3. It does seem like you want others to hold your hand and explain every detail, even when facts are obvious or very easy to confirm on your own.

            4. No sir. Frankly, I don’t care about the outcome of the suit. But when other’s speak with such certainty it’s totally appropriate to ask for proof, especially when there are so many mixed opinions with differing levels of rigor. Yes, I put the burden on them to prove their point. I wasn’t about to dive into the court briefs, neither did I make claim as to the merits of the case. I said it could be one way, or another. Right away people said FRAND, and I said “prove it”! If it was indeed so easy why did only the lawyer (TxUser) come forward with proff? HugH?

  2. Hard to understand how a company like Qualcomm could get away with such a scam unless it basically was blackmail.

    “You want THIS? You gotta pay THAT, even if it has nothing to do with THAT OTHER THING.”

    You would think there would be laws in place to prevent it.

  3. It’s like actors that want a percentage of gross ticket sales of the film they are working on. Deals like this are made, as weird as it may seem. Apparently Qualcomm thinks their chip is so damn important, they deserve a percentage instead of a flat rate. When Apple introduced Intel’s modem, Apple proved that sales are not impacted, (with some grumbling), and Qualcomm has no ground, rhetoric, legal or otherwise, to justify the fees they request.

    Apple has pulled a fast one – good on them – on Qualcomm. This is something that needed to happen.

    Imagine a desktop computer, where the modem/NIC component value, was higher than the video card or CPU?

    This is insane.

  4. It’s like actors that want a percentage of gross ticket sales of the film they are working on. Deals like this are made, as weird as it may seem. Apparently Qualcomm thinks their chip is so damn important, they deserve a percentage instead of a flat rate. When Apple introduced Intel’s modem, Apple proved that sales are not impacted, (with some grumbling), and Qualcomm has no ground, rhetoric, legal or otherwise, to justify the fees they request.

    Apple has pulled a fast one – good on them – on Qualcomm. This is something that needed to happen.

    Imagine a desktop computer, where the modem/NIC component value, was higher than the video card or CPU?

    This is insane.

    1. To be clear, the dispute is not about Qualcomm’s chips, but about the software patents that allow ANY modem chip to communicate with a cellular network. Even when Apple uses Intel modem chips, it is still required to use Qualcomm’s patents.

      The fact that these are “standards essential patents” (SEP) that are embedded in the cellular communication protocols is why Apple cannot avoid using them and why Qualcomm is obligated to allow use to all comers on a “fair, reasonable, and non-discriminatory” (FRAND) basis.

      A side issue in the licensing agreement (Qualcomm stopped paying Apple some agreed rebates because Apple cooperated with governmental investigations of Qualcomm) led to a breakdown in negotiations over the licensing terms. Apple then threw up its hands and asked the courts to determine what a FRAND fee for these patents might be. It has not unilaterally “stopped paying licensing fees,” but has simply started paying them into an escrow account until the courts tell both companies how to divide the money. It doesn’t trust Qualcomm to disgorge further overpayments.

      1. If Apple is using intel chips, and there is any frand licensing paid by intel to Qualcomm, why would Apple, or anyone else, be required to pay twice?

        1. Because the intellectual properties in dispute are not design patents on the chips, but software patents on the algorithms that the phone or other device uses to communicate with the cellular network. That process does not run just on the modem chip, but on other systems such as the CPU as well.

    1. botvinnik,

      The reason why would be the Supremacy Clause of the U.S. Constitution. The ITC was established in 1916 (as a successor agency to the U.S. Tariff Commission) as exactly what the excerpt above says it is: an independent, bipartisan, quasi-judicial, federal agency of the United States that provides trade expertise to both the legislative and executive branches.

      It is not “international” in the sense that any other country has influence over it, and it is only unelected in the same sense as every other executive branch agency except the President and Vice-President.

    2. You can say Fuck ’em and they may even deserve it, but we are bound by treaty. I’m sure we wouldn’t want to forfeit our influence over the satisfaction of effing them in this instance.

      (does an umlaut make it deeper?)

      1. I think we are bound by Article VI, Clause 2, of the U.S. Constitution:

        “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.”

        1. The ITC and its powers were created by “Laws of the United States,” and “the Judges in every state shall be bound thereby.” The law adopted by the Legislative Branch in 1916 provides that the ITC can adjudicate disputes like Qualcomm v. Apple, and that ITC decisions are to be implemented by the Executive Branch and enforced by the Judicial.

          No, the Constitution doesn’t say that each individual citizen is bound to follow Federal law, but the power of the judiciary will guarantee consequences for people who refuse to comply.

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