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Apple Files $1 billion Lawsuit Against Smartphone Chip Maker Qualcomm

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Apple Inc filed a $1 billion lawsuit against supplier Qualcomm Inc on Friday, days after the U.S. government accused the chip maker of resorting to anticompetitive tactics to maintain a monopoly over key semiconductors in mobile phones.

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The 100-page complaint filed Friday in a San Diego federal court depicts Qualcomm as a greedy monopolist abusing its power in a key segment of the mobile chip market to extort royalties for iPhone innovations that have nothing to do with Qualcomm’s technology.

For instance, Qualcomm demanded royalties on Apple’s fingerprint identification system built into recent models of the iPhone and also for larger storage capacities on the devices, according to the lawsuit.

“If that were not enough, Qualcomm then attempted to extort Appleinto changing its responses and providing false information to the KFTC in exchange for Qualcomm’s release of those payments to Apple. Applerefused,” Apple said in its lawsuit.

Qualcomm denied the allegations.

“Apple has been actively encouraging regulatory attacks on Qualcomm’s business in various jurisdictions around the world, as reflected in the recent KFTC decision and FTC complaint, by misrepresenting facts and withholding information,” Rosenberg said in the statement.

“We welcome the opportunity to have these meritless claims heard in court where we will be entitled to full discovery of Apple’s practices and a robust examination of the merits.”

Qualcomm’s stock closed 2.4 percent lower at $62.88 on the news.

Apple says it has been cooperating with government regulators who have been investigating Qualcomm’s business practices, prompting Qualcomm to retaliate by withholding about $1 billion in scheduled payments.

Apple launched its legal attack three days after the Federal Trade Commission filed a lawsuit alleging Qualcomm has been imposing unfair licensing terms on manufacturers.

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