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Fuzhou court sides with Qualcomm over Apple

By Ma Si and Cao Yin | China Daily | Updated: 2018-12-12 07:10
Apple and Qualcomm have been locked in global IP battles for nearly two years. Qualcomm first filed the current case in China late last year. [Photo/IC]

The legal patent battle between Qualcomm Inc and Apple Inc led to a Chinese court issuing a preliminary ban on sales of some iPhone models in the country.

Analysts said the law rules that the preliminary injunction must be immediately executed, but views differ as to how big an impact it will make on Apple's sales.

Qualcomm said on Monday the ban would affect the iPhone 6S through the iPhone X models, and was issued by the Fuzhou Intermediate People's Court in Fujian province, which found that Apple violated two of Qualcomm's patents.

In response to the ban, Apple said on Tuesday it has filed a request for reconsideration with the court, the first step in appealing the preliminary injunction.

A copy of the injunction China Daily obtained on Tuesday said that in the process of reconsideration, the implementation of the order will not be stopped. The preliminary order remains effective until the court makes a final ruling.

Li Junhui, an intellectual property law expert affiliated with China University of Political Science and Law, said, "It won't take long for the Fuzhou court to review Apple's reconsideration request, for reconsideration is usually a quick process."

China is a major market for Apple. In the third quarter of 2018, the country accounted for about 18 percent of the tech giant's $62.9 billion in global revenue.

China Merchants Securities said in a research note that if the order is strictly followed, it will negatively affect up to 6.73 percent of Apple's global sales. The calculation is based on the popularity and sales volume of each iPhone model in China.

According to Qualcomm, two patents involved in the legal dispute enable consumers to adjust the size and appearance of photos, and to manage applications using a touch screen on their devices.

Jia Mo, an analyst at market research company Canalys, said these patents are actually software patents and not related to important chip components Qualcomm used to provide to Apple.

"Apple aims to provide the iOS users with another software update to remove related features to avoid the ban. Also, previous similar preliminary orders have had a limited impact," Jia said.

On Tuesday, all iPhone models remained available in Apple stores and e-commerce platforms in China.

Apple and Qualcomm have been locked in global IP battles for nearly two years. Qualcomm first filed the current case in China late last year.

Yang Wu, head of the All-China Patent Attorneys Association, said two United States tech heavyweights availing themselves of a Chinese court for IP cases shows that they are more confident about the country's court rulings.

"In the past, large companies preferred to solve such disputes in the US, but now the moves by Apple and Qualcomm show their optimism in China. It also highlights that we have made significant progress in protecting intellectual property rights," Yang added.

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