The Chinese Courts have granted US chip maker Qualcomm (NASDAQ:QCOM) a preliminary injunction against Apple (NASDAQ:AAPL). If enforced, this would ban the majority of older iPhone model sales in China. The injunction has come at a critical time in the trade-war ‘ceasefire’ with some calling this move a counter attack.
Let’s dig in.
Qualcomm Injunction
Qualcomm and Apple have been disputing for years, locking horns in a legal battle over intellectual property. Qualcomm’s injunction claimed that Apple has stolen two of its technology patents used in the chips for the iPhone 6S, iPhone 6S Plus, iPhone 7, iPhone 7 Plus, iPhone 8, iPhone 8 Plus, and iPhone X.
Though the injunction has been granted, it has not yet been enforced. Should it go that far, these models will be banned from being sold in China. Of course, this will be a major blow to Apple, where it had a 25% stake in the market last year.
According to Don Rosenberg, general counsel of Qualcomm:
“Apple continues to benefit from our intellectual property while refusing to compensate us.“
Trade War?
However, some question that there is another reason for the courts to grant this injunction. Is it an opportunity to retaliate in the ongoing America/China trade war? Some believe that maybe the courts were using this case as another blow against America.
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Granting an injunction of this nature is rare. Especially at such a volatile time between the two superpowers. It’s possible that property ownership was not the true determining factor in reaching the decision.
President Trump and Xi reached a 90-day ceasefire in early December. However, the Chinese are considering the arrest of Huawei executive Meng Wanzhou as a breach of the peace. As such, the Qualcomm and Apple dispute has delivered a wonderful opportunity to retaliate in kind, by hitting one of America’s biggest tech companies hard and siding with Qualcomm.
Featured Image: depositphotos/belchonock
