Qualcomm Incorporated (Nasdaq: QCOM), pioneer and world leader of Code Division Multiple Access (CDMA) digital wireless technology, today stated the antitrust complaint filed by Broadcom Corporation on July 1, 2005 is meritless. Broadcom's accusation that Qualcomm has not lived up to its commitments to standard setting organizations to license its essential patents on fair and reasonable terms is belied by the more than 130 licenses that Qualcomm has granted to a broad range of companies. These licenses-including agreements with the world's largest and most sophisticated manufacturers of wireless telecommunications equipment-make Qualcomm's patents the most extensively licensed portfolio in the cellular industry. Qualcomm has granted and announced far more licenses under its essential patents than any other company claiming to hold patents essential to the CDMA2000, WCDMA or TD-SCDMA standards. Qualcomm's extensive licensing program has fostered the widespread adoption of its leading edge technologies and promoted vibrant competition throughout the wireless industry. Qualcomm's licensing practices are lawful, fair, reasonable and pro-competitive.
Broadcom's allegations regarding supposed monopolization by Qualcomm of a so-called "WCDMA market" are likewise demonstrably false. With many companies selling commercial WCDMA chipsets, competition among WCDMA chipset suppliers is healthy and intense, and Qualcomm has supplied only a small percentage of the WCDMA chipsets sold to date. The inability of Broadcom to attract customers for its WCDMA products, as admitted in Broadcom's complaint, is indicative of this highly competitive environment and not of any ostensible anticompetitive activity by Qualcomm.
"This case, like the earlier patent cases filed by Broadcom against Qualcomm, appears to be a desperate attempt by Broadcom to gain bargaining leverage through meritless litigation. Because Broadcom does not hold essential patents for the important cellular standards, Broadcom must feel compelled to resort to these kinds of measures rather than continuing to negotiate for licenses in good faith," said Louis M. Lupin, senior vice president and general counsel of Qualcomm. "Broadcom's unfortunate preference for the litigation forum rather than the negotiating table will require Qualcomm to proceed with litigation of its own."
Broadcom has a history of initiating litigation and International Trade Commission (ITC) proceedings that do not turn out well for the company. Broadcom's patent litigation and ITC proceedings against Intel resulted in Broadcom's paying Intel a $60 million settlement in 2003. Similarly, Broadcom filed patent claims against Microtune, Inc. in court and in the ITC with the outcome a $22.5 million settlement payment from Broadcom to Microtune in 2004. Broadcom's patent infringement claims against Agere Inc. suffered a similar fate with Broadcom reporting a $27.5 million charge to settle that litigation late last year.
Qualcomm also confirmed that it believes that the patent infringement claims filed in May of this year by Broadcom in federal court and in the ITC are without merit and that Qualcomm looks forward to proving that it has not infringed any of the asserted patents.
Qualcomm Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital wireless communications products and services based on the Company's CDMA digital technology. Headquartered in San Diego, Calif., Qualcomm is included in the S&P 500 Index and is a 2005 FORTUNE 500® company traded on The Nasdaq Stock Market® under the ticker symbol QCOM.
Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties, including the Company's ability to successfully design and have manufactured significant quantities of CDMA components on a timely and profitable basis, the extent and speed to which CDMA is deployed, 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 26, 2004, and most recent Form 10-Q.