Qualcomm v Arm: An Act of Weaponization of IP?
The Origin: Qualcomm’s Nuvia Acquisition
The controversy originated from Qualcomm’s purchase of Nuvia for $1.4 billion in 2021. The company Nuvia used to develop its high-performance custom CPU cores through the Arm instruction set architecture which its ex-Apple engineers founded. The companies known as Nuvia obtained two distinct Arm licenses from Arm Holdings before Qualcomm acquired the startup namely the Architecture License Agreement (ALA) and Technology License Agreement (TLA). Arm granted Nuvia the right to generate and adjust proprietary cores that implemented Arm’s Instruction Set Architecture through two distinct licenses that restricted future transfers.
After the Nuvia takeover Qualcomm used startup technologies to develop new Snapdragon processors intended for Windows computers and “AI laptops.” The product direction of Qualcomm focused on Oryon cores which emerged from their recent chip development. The transition from Nuvia to Qualcomm did not find approval from Arm. Arm initiated legal action through Delaware federal court during August 2022 because Qualcomm and Nuvia preserved unlicensed intellectual property they acquired from Nuvia demanding a court order for Qualcomm to stop using the IP and destroy it.
Licensing & Trademarks
The core disagreement in Arm’s legal action stems from contract provisions that forbid license transfers. According to Arm’s case Nuvia received exclusive licenses which termination occurred through automatic processes upon Qualcomm’s purchase of Nuvia. From Arm’s perspective, Qualcomm’s use of Nuvia’s designs under its own license amounts to IP infringement. The case also contained Lanham Act trademark claims when Arm said that Qualcomm’s “Arm-based” chip labels were untrustworthy.
- Lanham Act (Trademark claims): Prohibits false or misleading use of trademarks
In response to Arm’s lawsuit in 2024 Qualcomm stated that its original Arm architecture license permits building any chips that use the Arm instruction system including ones built by acquired companies. Qualcomm maintains through its engineers that the Oryon cores were built completely new while retaining only a limited amount of intellectual property from Arm. The company made clear that its chips operate solely with the Arm ISA standard as a published specification and that architectural licensing allows independent implementations of Arm instructions even when another entity initially designed them.
In other words, Qualcomm’s argument hinges on scope. It claims its license covers any design that implements Arm’s instruction set, regardless of who initially created it so long as the acquiring company holds a valid license. Arm perceives this move as something that weakens its fundamental licensing model and profit structure of the organization.
A Partial Victory for Qualcomm & A Deadlock for Arm
During December 2024 the case proceeded to court trials where both parties made technical and financial as well as legal presentations. Qualcomm received a victory when a Delaware jury decided Qualcomm’s present Snapdragon chips are covered within Qualcomm’s ALA licensing framework. The verdict enabled Qualcomm to retain Oryon-based chip production capabilities which then enabled them to market the “Copilot+” AI laptop lineup.
The jury remained undecided about Nuvia’s non-compliance with its contractual arrangements from its time with Arm. Due to the undecided question more legal disputes between the parties remain possible. The parties now prepare for the forthcoming stage of a seemingly extended legal process after Arm initiated the motion for retrial.
The Stakes
Both Qualcomm and Arm comprise only part of what is at stake in this case. The transformation in this dispute affects all sectors related to the global semiconductor field. Arm’s licensing approach functions as the base structure for developing smartphone processors and numerous processor chips used in IoT and automotive industries. As a neutral supplier of ISA and core designs Arm has maintained a history of supplying Apple and Samsung and Qualcomm alongside other companies in exchange for paying royalties. The potential entry of Arm into chip fabrication and its desired royalty rise erodes the company’s previous position as an IP vendor.
Qualcomm has charged Arm with deploying intellectual property terms as weapons to hamper both innovation and market competition. The company has filed antitrust complaints with legal authorities in the U.S., the European Union and South Korea because it claims Arm uses discriminatory tactics against licensees who attempt to create innovative custom cores.
From Arm’s perspective, it’s about protecting its IP and revenue model. It contends that Qualcomm exploited a technicality to skip paying higher royalties, which would cost Arm tens of millions of dollars per year and undermine its relationships with other licensees.
The Road Ahead
The case persistently remains active at the beginning of 2025. At present Arm fights to obtain a new trial regarding the Nuvia matter. Qualcomm added new accusations to its lawsuit by claiming that Arm disrupts its customer agreements and operates in an uncompetitive manner. Multiple authorities from different nations launch investigations into Arm’s licensing practices.
The financial interests between the companies continue to escalate throughout this period. The Snapdragon Oryon chips serve as Qualcomm’s main instrument to expand into the laptop market while Microsoft and other companies strive for advanced AI-based PC development. A court loss or regulatory sanction might compel Qualcomm to redesign its chips unless it pays substantial financial penalties. Arm may face customer loss when its IP enforcement strategies border on aggressive or unfair behavior.
Conclusion
The legal dispute between Qualcomm and Arm implications extend beyond their contract interpretation. This legal dispute serves as a vital exam of licensing practices because modern technological innovation depends on interchangeable modules and joint development through acquisitions. The situation brings forward essential considerations regarding what transpires to intellectual property rights when startup organizations undergo mergers or acquisitions. How far can a license extend? A licensor retains the right to amend rules during active gameplay while maintaining the potential to damage innovation.
Reference
- Arm Ltd. v. Qualcomm Inc. (1:22-cv-01146) District Court, D. Delaware
- Anonymous. (2023, July 13). ARM files lawsuit against Qualcomm and Nuvia for breach of license agreements and trademark infringement. Arm Newsroom. https://newsroom.arm.com/news/arm-files-lawsuit-against-qualcomm-and-nuvia-for-breach-of-license-agreements-and-trademark-infringement
- Sharwood, S. (2025, February 7). Arm gives up on killing off Qualcomm’s vital chip license. The Register. https://www.theregister.com/2025/02/06/arm_qualcomm_nuvia/
