A jury in a U.S. federal court has ruled that Qualcomm’s central processors are properly licensed under its agreement with Arm Holdings. This decision allows Qualcomm to continue its expansion into the laptop market, although some uncertainty remains.
The case, which involved a week of arguments and deliberations, ended in a mistrial because the jury couldn’t agree on whether the startup Nuvia, acquired by Qualcomm in 2021, violated its license with Arm. However, the jury did find that Qualcomm itself did not breach the license and that its chips using Nuvia technology are properly licensed.
While Qualcomm celebrated the verdict as a confirmation of its right to innovate, Arm expressed disappointment and plans to seek a new trial. The judge encouraged both companies to find a resolution through mediation.
This outcome allows Qualcomm to proceed with its “AI PC” initiative, developing laptop chips for tasks like running chatbots and image generators. However, the trial highlighted a broader industry issue about the boundaries of Arm’s technology and intellectual property rights, which could have implications for other companies that license Arm’s architecture.
Essentially, the dispute boils down to the royalty fees Qualcomm should pay for each chip. Arm argues that Qualcomm is using Nuvia’s technology, which was subject to higher royalty rates, under its own license with lower rates.
Although the immediate impact on Arm’s financial projections seems minimal, the case raises important questions about the extent of Arm’s control over custom core designs developed by its licensees.