Qualcomm Wins ParkerVision Patent Ruling - Analyst Blog

Recently, a federal judge of the U.S. District Court for the Middle District of Florida overturned an earlier verdict of a $173 million patent infringement charge against Qualcomm Inc. QCOM by wireless chipset designer ParkerVision Inc. In 2011, ParkerVision claimed that Qualcomm had violated its patents associated with the conversion mechanism of electromagnetic signals from higher frequencies to lower frequencies.

The technical advantage of this technology is that receivers of mobile phone and tablet will become smaller, more power efficient and highly effective. Qualcomm has denied the charges brought against it. The federal judge ruled out that ParkerVision's litigation has insufficient evidence of patent infringement. However, the judge also rejected Qualcomm's appeal to rule the patent invalid. ParkerVision has decided to seek a review of the judgment.

Qualcomm is the largest baseband chipset developer for mobile handsets globally. The company's chips are used in Apple Inc.'s AAPL iOS software, Microsoft Corp.'s MSFT Windows Phone operating systems and Google Inc. GOOG developed Android software, especially Samsung's Galaxy series of mobile gadgets. Qualcomm currently carries a Zacks Rank #2 (Buy).

Notably, there are several pending litigation cases relating to infringement of patent rights against Qualcomm throughout the world. The company is facing an anti-monopoly investigation by the National Development and Reform Commission (NDRC), the regulatory authority of China. The company stated that it is not aware of any activity that violates the anti-monopoly law in China and will continue to cooperate with the NDRC. Losing these pending cases will considerably pressurize the company's cash flow.   

ParkerVision has two patent litigation cases against Qualcomm. The first one, which was recently overturned by a federal judge, is related to the technology used in $4 chipsets. However, the second case involves a more complex technology which includes patents related to the technology of mobile device's information sharing with a wireless tower. This technology costs $20 or more per mobile device.