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Qualcomm to return nearly $815 mn to BlackBerry on overpaid royalties

13 April 2017

Qualcomm was yesterday ordered by an arbitrator to return nearly $815 million to BlackBerry for royalties the Canadian smartphone maker overpaid between 2010 and 2015.

Interest and attorney fees have not been added in the preliminary order and will be added in May, which may take the total payment to over $1 billion.

Although Qualcomm disagreed with the arbitrator's decision, but it cannot be challenged since both sides had earlier agreed that the order would be final and binding.

Qualcomm said that while it does not agree with how the arbitration worked out, it admitted that ''it is binding and not appealable.''

''The arbitration decision was limited to prepayment provisions unique to BlackBerry's license agreement with Qualcomm and has no impact on agreements with any other licensee,'' the company said in a statement.

Last year, BlackBerry and Qualcomm entered into talks to settle the dispute and analyze an existing agreement to cap certain royalties applied to payments made by BlackBerry under a license agreement between the two parties.

Qualcomm's contention was the agreement to cap certain royalties applied to payments made by BlackBerry under a licensing deal, while BlackBerry argued that a previous contract made with Qualcomm to cap royalties also applied to payments made by it under an older license agreement.

San Diego-based Qualcomm, which owns patents on mobile technology, gets a fixed royalty on the selling price of handsets from phone makers, and generates a large chunk of its profit from these license payments.

BlackBerry, which has a market valuation of about C$5.45 billion, contended that it shipped far fewer phones than it expected between 2010 and 2015, and was therefore seek a refund on some of the payments.

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