Qualcomm and Arm begin trial as potential for huge damages comes into focus
QCOM•Qualcomm is seeking to stop paying Arm royalties for up to five years, potentially worth billions, in a trial over contract disputes. Qualcomm says an alleged leak damaged its Meta deal by $170 million, while a judge weighs whether a contract term could limit damages.
1. Trial opens over contracts
Qualcomm and Arm began a trial in Delaware over Qualcomm’s accusations that Arm withheld chip-testing tools and leaked a notice that it was threatening to terminate a license agreement. Qualcomm says the leak hurt discussions for a chip deal with Meta, reducing the deal’s value by $170 million; Arm argued Meta changed its plans and was not harmed.
2. Royalties and damages at issue
Qualcomm is seeking to stop paying Arm royalties for up to five years, potentially worth billions of dollars to Arm. Judge Maryellen Noreika is weighing whether to strike a contract term that could limit Qualcomm to seeking a smaller amount of damages.
3. Separate licensing dispute
In a related bench trial, the judge heard arguments over whether Arm negotiated in good faith on the next version of its chip technology. Qualcomm CEO Cristiano Amon testified that Arm sought an 18,500% increase in royalty payments between versions 9 and 10 of its computing architecture; Qualcomm’s agreement with Arm runs through 2033.
