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Qualcomm Forced To Refund BlackBerry $815M In Royalty Payments

BlackBerry was awarded $814.9 million following a dispute with Qualcomm over patent royalties.

How The Dispute Started

Back in 2010, BlackBerry signed a license agreement with Qualcomm, in which it paid royalties for all the Snapdragon-based smartphones it was expecting to sell by 2015.

As we know, BlackBerry hasn’t done so well in the smartphone market over the past few years, and in fact it even got out of the market last year. The company entered arbitration with Qualcomm last year to recuperate some of the money it paid for licenses that it never used.

Even though the original deal was supposed to be non-refundable, per the contract between the two companies, the arbitrator seems to have agreed with BlackBerry that it doesn’t make sense to pay royalties for units it never sold. As such, Qualcomm was ordered to refund BlackBerry a part of the original sum. Qualcomm said in a statement that it disagrees with the decision, but it’s binding, so it will have to refund BlackBerry.

Qualcomm’s Patent Troubles

Over the past several years, Qualcomm has drawn the attention of multiple regulators who accused Qualcomm of abusing its market position to overcharge its customers and take out competitors.

Qualcomm was recently fined over $850 million by the Korean Fair Trade Commission (KFTC). Back in 2015, it also had to pay a $975 million fine to the Chinese government over similar accusations. The European Commission started its own ongoing antitrust investigation against the company in the same year.

This year, the U.S. Federal Trade Commission (FTC) also charged Qualcomm with using anti-competitive tactics to monopolize the market. Apple sued the modem maker for $1 billion, too, arguing that it overcharged it for basic smartphone technology.

Qualcomm recently launched a counter-suit against Apple, but so far it looks like all the evidence is piling up against Qualcomm as being the aggressor in the market. It was also recently revealed from the KFTC’s case against Qualcomm that the company blocked Samsung from selling its own Exynos chips to other smartphone manufacturers for 25 years. This may explain why Samsung never decided to sell its highly competitive chip to other companies, the same way it sells its Super AMOLED displays or builds competitors' chips in its manufacturing facilities.

Updated, 4/12/2017, 11:55pm PT: Qualcomm denied that it has been blocking Samsung from selling its own chips to other smartphone manufacturers:

"Qualcomm has never stood in the way of Samsung selling chips to third parties, and nothing in our agreements has ever prevented Samsung from doing so. Any statement to the contrary is false," said a company representative.