Court documents show Apple purposefully bought pools of cheap patents to help make Qualcomm’s royalty demands appear overpriced

The Qualcomm and Apple legal battle has now concluded thanks to a settlement of unknown financial value, but as the settlement came one day in to the start of the trial, a few tidbits from discovery process have still seeped out.

One particularly devious point is that Qualcomm lawyers found internal Apple emails that showed the company was specifically seeking patent licenses that were bargain deals to then use it as evidence against Qualcomm’s royalties, by contrasting the cost of each pile.

In opening statements, the Washington Post highlighted that Apple lawyers argued to the jury that Apple had successfully made deals with patent licenses from companies like Huawei and Ericsson, and that all those grouped together was twice the size of Qualcomm’s patent pile but available at a fraction of the cost.

This argument seemed strong until Qualcomm found contradictory evidence that Apple had strategically set out to buy mountains of patents that would make Qualcomm’s look cheap, rather than that just being the state of nature. Qualcomm lawyers said Apple’s aim was to ‘create’ evidence.

According to the documents, Apple said it would “selectively filter” a group of patent licenses for “the most desirable deals,” using the patents as “evidence as a comparable in disputes with others.” Qualcomm lawyer Evan Chesler alleged the “others” referred to Qualcomm. Apple declined to comment on the documents and allegation.

“So they went out to these other companies and they negotiated very cheap deals within the last couple of years to create the evidence to come in here and tell you that those guys are the good guys because they are getting less for their patents and we are the bad guys,” Chesler argued to the jury.

The Washington Post quotes a law professor who says this finding is ‘unsettling’ as it possibly means Apple was behaving in bad faith to antitrust commissions about the true value of Qualcomm’s patent portfolio.

Neither Apple nor Qualcomm has looked particularly magnanimous over the last couple years of the dispute.

A ruling from the FTC on Qualcomm’s abuse of the FRAND standards essential patents system is due in the next couple of months.

However, the good news is the legal settlement does mean that customers will ultimately benefit with the best 5G chips available for the ‘iPhone 12’ in 2020.

Apple’s original plan was to rely on Intel to provide a 5G modem on a timely schedule, but it appears Intel failed to deliver and the company has now decided to wind down the modem business.