Qualcomm CEO Says Settlement With Broadcom Unlikely

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NEW YORK (Dow Jones) Qualcomm has been unable to resolve its dispute with Broadcom because a deal would hurt its licensing business Chief Executive Paul Jacobs said Wednesday.

Qualcomm and Broadcom are in the middle of a vicious legal battle fought across a myriad of courtrooms. Broadcom has won the last two cases, which put Qualcomm on shaky ground.

Jacobs, speaking during a conference call to discuss its quarterly report, said Broadcom wants its customers to be exempt from paying Qualcomm licensing fees for a large chunck of its intellectual property portfolio as part of a settlement.

"That is unacceptable," Jacobs said. "We continue to believe the rulings are wrong."

President Steve Altman said that Broadcom is arguing that since it is exempt from licensing fees, it's customers should be, too.

But David Rossman, who heads of up intellectual property litigation for Broadcom, said, "a solution with Qualcomm will not eliminate their licensing program."

Qualcomm can seek licenses from anyone, including Broadcom customers, he said, adding he was glad Qualcomm seemed more open to discussing a settlement.

Qualcomm is pursuing all avenues of reversing and mitigating the legal decisions, Jacobs said.

Jacobs said the next few months represent a "crucial litigation timeframe."

Verizon Wireless will have to pay Broadcom a licensing fee as part of their recently struck deal. The chief executive of Verizon Wireless said he would seek a way to receive compensation for the payments.

This has analysts looking to Qualcomm to pay Verizon Wireless back. Altman said that if necessary, Qualcomm would support the carrier financial. He added there was no agreement in place.

"We've made it clear to them we would support them," he said. "They're a very important customer of ours. We're certainly willing to help, as we would with other carriers as well."

Verizon Wireless is Qualcomm's largest carrier customer.

-By Roger Cheng, Dow Jones Newswires; 201-938-2020; roger.cheng@dowjones.com

(END) Dow Jones Newswires"

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