Qualcomm Incorporated (NASDAQ: QCOM) today announced that the U.S. District Court for the Southern District of California decided in Qualcomm's favor by lifting a temporary restraining order and denying a preliminary injunction requested by Motorola. The Court's ruling clears the way for commercial production and sale of Qualcomm's "Q" phone. The ramping up of production of Qualcomm's 1900 MHz Code Division Multiple Access (CDMA) PCS "Q" phone was immediately resumedas a result of this decision.
"We are delighted that the Court has agreed with our position that the 'Q' phone is a distinct product and that we should not be enjoined from producing it," said Dr. Irwin M. Jacobs, chairman and CEO of Qualcomm. "Qualcomm prides itself on its innovation and the ability of its creative team to bring unique products to market rapidly."
"We are immediately resuming preparation for production to meet the requirements of our customers," said Dr. Paul E. Jacobs, president of Qualcomm's Subscriber Products Division. "This decision is a win for consumers who will soon be able to purchase the world's smallest CDMA digital PCS phone."
The Court found that there are significant differences between the Qualcomm "Q" phone and the design of the Motorola StarTAC phone, and that Motorola has no likelihood of success on the merits of its claims of design patent or trade dress infringement. In so finding the Court noted, among other things, that "the 'Q' phone presents a sleeker, streamlined appearance" ascompared to the "box-like appearance" of the StarTAC design patent, and that Motorola is not entitled to monopolize a functional shape like a clam-shell phone. The Court also referred to the apparent taking of Qualcomm's proprietary information by Motorola, saying it "takes a dim view of the actions of Motorola in handling this situation."
The Company noted, however, that the Court's ruling in favor of Qualcomm is only a preliminary determination pending trial or possible appeal. The Court will set a trial date, anticipated by the Company to be some time next year.
Qualcomm's Personal Communications Services (PCS) 1900 MHz "Q" phone is the smallest and lightest CDMA phone in existence, weighing in at approximately 5 ounces. Designed with frequent wireless users in mind, the "Q" phone offers the convenience of a small phone plus delivers the advanced performance of a complete wireless information appliance. The new "Q" phone supports instant wireless access to information previously available only from computing devices, including meeting schedules, airline reservations, stock quotes, weather reports, movie listings and sports scores. The "Q" phone is expected to become commercially available during the summer of 1997. The hallmarks of every Qualcomm CDMA digital phone include crystal clear voice quality, enhanced privacy, fewer dropped calls, and longer talk and stand-by times.
The Company also noted that the Court denied the Company's request for a preliminary injunction to prevent Motorola from communicating its claims of utility patent infringement to potential customers.
Headquartered in San Diego, Qualcomm develops, manufactures, markets, licenses and operates advanced communications systems and products based on its proprietary digital wireless technologies. The Company's primary product areas are the OmniTRACS® system (a geostationary satellite-based, mobile communications system providing two-way data and position reporting services), CDMA wireless communications systems and products and, in conjunction with others, the development of the Globalstar™ low-earth-orbit (LEO) satellite communications system. Other Company products include the Eudora Pro™ electronic mail software, ASIC products, and communications equipment and systems for government and commercial customers worldwide. For more information on Qualcomm products and technologies, please visit the Company's web site at http://www.qualcomm.com.
Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties, including the risk of timely product development and commercial implementation of the Company's CDMA products, continued growth in the CDMA subscriber population and the scale up and operations of CDMA systems, the Company's ability to successfully manufacture significant quantities of CDMA or other equipment on a timely and profitable basis and those related to performance guarantees, change in economic conditions of the various markets the Company serves, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended September 29, 1996 and most recent Form 10-Qs.
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