Qualcomm Patent Infringement Ruling Upheld by ITC; Broadcom Wins

In what could be the final word on the subject from a patent authority, the International Trade Commission has upheld a ruling last October stating that networking technology supplier Qualcomm did indeed infringe upon a critical patent held by technology developer Broadcom.

Specifically, the "'983" patent covers a portable communications device with transceivers for both wired and wireless networks. The upholding could pave the way for a possible injunction against the sale of infringing technology by Qualcomm in the US.

The ruling does not affect the outcome of proceedings regarding Qualcomm's counter-claims, that Broadcom infringed upon Qualcomm's patents for 3G cellular chips. However, the prospect of those claims' success remain bleak, following a denial of Qualcomm's request for an injunction against Broadcom last October.

Broadcom's original complaint concerned three of its patents; last Friday's ruling upholds a finding in favor of just one count of infringement. But for Broadcom, one was enough. Like a hunter dancing over a fallen elephant, its response, rendered by senior vice president and general counsel David Dull, was both jovial and mocking.

"Qualcomm expects other companies to respect and pay dearly for the use of its intellectual property, but refuses to respect the intellectual property of others," Dull stated. "The Commission's decision is an important step toward leveling that lopsided view. We fully intend to prosecute this ITC case to conclusion, and to continue to aggressively enforce our patent rights against Qualcomm in other pending cases."

In its own statement, whose initial paragraphs at first looked like a reluctant acceptance of defeat, Qualcomm managed to transform defeat into an opportunity for appeal.

"While Qualcomm will continue to contest validity and infringement as to the '983 patent on appeal and in district court," wrote its general counsel, Louis Lupin, "we are pleased that the [Administrative Law Judge] recognized that the accused functionality is controlled by a limited and specific portion of software which Qualcomm does not import into the United States."

If the Commission were to agree with Qualcomm that the infringed-upon technology isn't really used by Qualcomm in US products, as Qualcomm sees it, an injunction against the sale of certain goods here might not be necessary.

That will be a stretch, since technologies imported into the US is specifically the purview of the US ITC, otherwise this matter wouldn't have been adjudicated here in the first place. But in any event, Lupin concluded - like the loser in a best-two-out-of-three wrestling match on the playground - it wasn't really an important case anyway. "Public interest factors to be considered by the full Commission but that were not at issue before the ALJ," he wrote, "weigh even more heavily against any order barring the importation of handsets made by third parties."

The worst possible outcome of this decision for Qualcomm would be an injunction against the sale not of specific portions of software, as Qualcomm put it, but entire cellular handset product lines. Qualcomm doesn't manufacture handsets; it makes chipsets that others use, so the decision will impact Qualcomm's customers.

With CES 2007 just a month away, some of those customers may have to rethink their marketing plans for next year. Even if Qualcomm does appeal, the injunction could still come as soon as February 9, and signed into effect by President Bush within 60 days of that ruling.