Qualcomm alleges Apple stole chip secrets and gave them to Intel

26 Sep 2018

Apple iPhone XS smartphone. Image: Hadrian/Shutterstock

The chips are down as high-stakes legal battle between tech giants ramps up dramatically.

In the latest salvo in a bitter legal dispute, Qualcomm has alleged that Apple stole intellectual property (IP) and gave it to Intel, ostensibly so Intel could make lower-price chips for the iPhone. Intel modem chips are used in the new iPhone XS, XS Max and iPhone XR smartphones.

Qualcomm, a major player in the smartphone and automotive space with major designs on the internet of things (IoT) market, has been locked in an explosive legal battle with Apple since last year. At the heart of the matter is a patent dispute and bad feelings over the price Qualcomm was charging Apple for the use of its chips. It stems back to a major deal between the two companies governing the supply of chips between 2011 and 2016.

Apple sued Qualcomm last year, claiming the latter was charging exorbitant royalties for what it claimed were unique Apple innovations. Qualcomm countersued, claiming that the iPhone’s success would not have been possible without its technology.

Chips and splinters as IP fight turns nasty

The legal dispute has entered a new epoch, with Qualcomm levelling the significant claim that Apple breached a so-called master software agreement, alleging that the source code and tools were stolen for the express purpose of helping Intel to overcome engineering flaws in its chips that contributed to their poor performance in iPhones.

It is understood that as part of Qualcomm’s agreement with Apple, the former’s engineers were to be allowed to periodically ensure that the source code software and tools shared with Apple were appropriately protected. However, Qualcomm alleges that it was prevented from auditing Apple’s use of its source code. It has now made the explosive claim, apparently based on evidence, that Apple shared IP with Qualcomm rival Intel.

“Apple has engaged in a years-long campaign of false promises, stealth and subterfuge designed to steal Qualcomm’s confidential information and trade secrets for the purpose of improving the performance and accelerating time to market of lower-quality modem chipsets, including those developed by Intel Corporation, competitor of Qualcomm, to render such chipsets usable in Apple iPhones and other devices, with the ultimate goal of diverting Qualcomm’s Apple-based business to Intel,” Qualcomm has alleged in a filing made in the superior court in San Diego.

Qualcomm is claiming that engineers unearthed evidence that the source code was repeatedly provided to Intel engineers to help improve the performance of Intel chips. Reports suggest that the evidence includes email correspondence, source code development history and the code used in Intel-based smartphones.

It will now be up to the judge in San Diego to add the latest charges to the current lawsuit Qualcomm is taking against Apple that is due to take place in April 2019.

At the time of writing, neither Apple nor Intel have publicly commented on the latest allegations.

Apple iPhone XS smartphone. Image: Hadrian/Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years