Jury trial kicks off Arm's wrestling match with Qualcomm

The battle between British chip designer Arm Holdings and Qualcomm kicked off today in Delaware District Court.

The long-awaited jury trial, which is expected to play out over the next five days, comes more than two years after Arm first filed suit against one of its largest customers over allegations that Qualcomm had breached the terms of its licenses.

The debacle began in 2021 when Qualcomm acquired Nuvia, a startup backed by former Apple chip engineers developing Arm-based processors for the datacenter. The purchase was seen as a way for Qualcomm to better compete against its rivals, most notably Apple, which a year earlier had expanded its family of Arm-compatible processors in the notebook and desktop space.

However, not long after the $1.4 billion acquisition closed, Qualcomm was confronted by Arm. The crux of the issue, at least according to Arm, is that the licenses granted to Nuvia couldn't be transferred to Qualcomm without its blessing.

As we previously reported, the bigger issue related to Qualcomm's use of Nuvia designs came down to royalties paid to Arm for the privilege. Nuvia was reportedly subject to a higher royalty rate than Qualcomm had negotiated for its own parts, yet following the acquisition, the latter aimed to use Nuvia's technologies at that lower rate.

Arm's argument was that Qualcomm shouldn't get to acquire IP developed using Arm's technologies and keep paying the same royalties it always had.

After the two companies failed to reach an agreement for the use of Nuvia's core IP, Arm terminated Nuvia's licenses in early 2022, and called on Qualcomm to destroy designs derived from the acquisition. But while Qualcomm's lawyers said the company would abide by the termination, Arm remained unconvinced that Qualcomm had actually followed through with destroying designs.

Since the legal spat began, Qualcomm has pushed ahead with its plans to develop an in-house core design to power its X-series notebook processors and Snapdragon 8 Elite smartphone chips.

• Qualcomm guns for Intel, AMD with cheaper 8-core X chips
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• Apple reportedly building AI server processor with help from Broadcom
• Microsoft rolls out Recall for Intel, AMD-based Copilot+ PCs

Qualy's X-Elite and X-Plus processors are intended to compete with Intel and AMD's x86 chips and Apple's M-series processors in the notebook sphere. The chips were among the first to power a new series of "AI PCs" that could take advantage of Microsoft's Copilot+ features announced back in May.

Arm, for its part, hasn't been sitting idly. In October, amidst Qualcomm's annual Snapdragon Summit in Hawaii, it was reported that Arm had issued a notice warning the US SoC giant that its architectural licenses would be canceled in 60 days. Such a notice would effectively derail its latest generation of products based on its Oryon cores.

At the time, Arm argued Qualcomm's repeated efforts to undermine its license agreement left it no choice but to take formal action. However, the outcome, it seems, will be decided this week. Each party in the case has until Friday to make their case, and after that, it'll be up to the jury to decide.

Arm CEO Rene Haas, Qualcomm CEO Cristiano Amon, Nuvia founder Gerard Williams, and SoftBank CEO Masayoshi Son are all listed as potential witnesses. ®