Qualcomm's lengthy legal battle with Arm nets it $2 (not a typo) in damages

Qualcomm and Arm have been involved in a series of legal battles over several issues over the last couple of years. Since Qualcomm acquired Nuvia back in 2021, Arm has threatened to cancel Qualcomm’s architecture licensing agreement (ALA), and Qualcomm has filed lawsuits against Arm.

According to a Reuters report, the verdict is finally in for Qualcomm’s latest lawsuit against Arm. The Delaware jury has sided with Qualcomm on two counts, awarding it damages amounting to $2. Yes, that’s not a typo.

The jury found that Arm breached its obligation to provide software patches and tools for designs it licensed to Qualcomm. The jury also agreed with Qualcomm on the count that Arm intentionally interfered with Qualcomm’s relations with Meta. However, it sided with Arm on five other counts.

Both Qualcomm and Arm are calling the outcome a victory. However, the lawsuit is far from over. It will now move to the next stage before US District Judge Maryellen Noreika, who could potentially rule that Qualcomm can stop paying royalties to Arm for five years — a decision that could amount to billions of dollars in losses for Arm.

Today’s ruling, however, could have a major impact on the tech industry. It establishes that companies with existing licenses don’t have to pay duplicate licensing fees if they acquire another company to enhance their chip-making efforts. Since Qualcomm already had an ALA with Arm, its acquisition and use of Nuvia’s know-how for designing CPU cores can’t be called a breach of contract.

However, if Judge Noreika rules that Qualcomm must pay licensing fees to Arm for the next five years, it could affect chip prices, which could in turn affect smartphone prices. Needless to say, this is a lawsuit worth keeping an eye on.