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Arm is suing Qualcomm in hopes of reversing Qualcomm’s $1.4 billion Nuvia purchase.

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UPDATE: Qualcomm responded to Arm’s Nuvia lawsuit. The company believes the law is on its side. It said that it has “broad” license rights that protect its custom CPU efforts.

ORIGINAL ARTICLE: The UK-based chip manufacturer Arm has recently sued Qualcomm over its purchase of chip design firm Nuvia. Qualcomm paid $1.4 billion for the acquisition. Arm believes this deal breaches license agreements and is trademark infringement between companies.

Nuvia and Arm already have some design license agreements, and Arm says Nuvia needs its approval before transferring these licenses to Qualcomm. Arm is also asking the court to compel Qualcomm to destroy designs developed under Nuvia’s license agreements with them.

On the other side, Qualcomm says Arm can’t interfere with Qualcomm’s or NUVIA’s innovations. “Arm’s complaint ignores the fact that Qualcomm has broad, well-established license rights covering its custom-designed CPU’s, and we are confident those rights will be affirmed,” Ann Chaplin, General Counsel of Qualcomm, said in a statement.

Qualcomm and Arm are already strategic partners

Nuvia is one of the greatest acquisitions of Qualcomm in recent years and could help the company with its chip design. However, Qualcomm and Arm also have a long history of cooperation with each other, especially for the design of custom computing cores. Qualcomm executives believe Arm’s low pace of innovation is why Apple has surpassed them in terms of chip performance.

Nuvia was also founded by a group of former Apple chip architects, and last year, it was acquired by Qualcomm for $1.4 billion. With the acquisitions, Qualcomm hopes to differentiate itself from rivals like MediaTek, which is currently using the same standard Arm designs. Qualcomm is also seeking to add fuel to the fire of competition with Intel and AMD in the PC and laptop markets.

Both companies are now dominating the market, and Qualcomm could use Nuvia innovations to develop computing cores for PCs and laptops. Qualcomm CEO Cristiano Amon already told Reuters that he wanted to use Nuvia’s Arm-based designs to compete in the Windows-based laptop market.

The fact is that Qualcomm and Arm are largely dependent on each other, and Qualcomm even pays a royalty rate to Arm for each chip sold. However, the Nuvia deal would help Qualcomm to aim for more custom core designs. Despite using Arm’s architecture, Nuvia chips have custom designs. Relying on the Nuvia innovations, Qualcomm actually wants to reduce its dependence on Arm in the long term. This is the same strategy Apple used to ditch Intel from its Mac laptops.

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