Arm files lawsuit against Qualcomm and subsidiary Nuvia for trademark infringement and breach of license agreements
Arm’s importance for the IT&C industry is undeniable as it licenses its CPU and GPU cores to so many key companies including Apple, Qualcomm, MediaTek and even Intel. Nvidia was well aware of this fact when it tried to buy Arm from SoftBank, yet each and every Arm customer denounced this action, which raised serious concerns regarding a possible monopoly on the whole IP licensing process. Alas, Nvidia’s plans to acquire Arm were met with insurmountable regulatory scrutiny and the acquisition deal fell through. However, right around the time Nvidia announced the deal termination, it so happens that former Nvidia Vice President Rene Haas was named Arm’s CEO. Half a year later, Arm proceeds to sue Qualcomm and its subsidiary Nuvia for license agreement breach and trademark infringement.
Qualcomm acquired Nuvia in early 2021 and thus all of Nuvia’s technologies that used licensed IPs from Arm transferred to Qualcomm. Even though Arm agreed to let Nuvia modify its licensed IPs and create custom Phoenix core designs, these provisions apparently were voided with the Qualcomm acquisition. In March this year, Arm terminated all of Nuvia’s licenses, but Qualcomm continued to develop technologies based on the custom Phoenix cores, further breaching Arm’s agreements. With the newly filed lawsuit in the US District Court of Delaware, Arm intends to force the destruction of Nuvia’s Phoenix custom cores and eventually unwind the entire acquisition of Nuvia, as well as obtain some compensation for the trademark misuse.
Because Qualcomm attempted to transfer Nuvia licenses without Arm’s consent, which is a standard restriction under Arm’s license agreements, Nuvia’s licenses terminated in March 2022. Before and after that date, Arm made multiple good faith efforts to seek a resolution. In contrast, Qualcomm has breached the terms of the Arm license agreement by continuing development under the terminated licenses. Arm was left with no choice other than to bring this claim against Qualcomm and Nuvia to protect our IP, our business, and to ensure customers are able to access valid Arm-based products.
Qualcomm’s General Counsel Ann Chaplin promptly responded that the allegations are unfounded and the company seems ready to defend itself and Nuvia in court: “Arm’s lawsuit marks an unfortunate departure from its longstanding, successful relationship with Qualcomm. Arm has no right, contractual or otherwise, to attempt to interfere with Qualcomm’s or Nuvia’s innovations. Arm’s complaint ignores the fact that Qualcomm has broad, well-established license rights covering its custom-designed CPU’s, and we are confident those rights will be affirmed.”
As pointed out by Twitter user Sravan Kundojjala, Arm’s allegations might also have something to do with Nuvia’s plans to license the Phoenix cores to select Chinese customers. Furthermore, back when the UK regulators were assessing the feasibility of Nvidia’s acquisition, Arm defended the case suggesting that customers who used its core licenses for custom designs were to be regarded as direct competitors.