And now time for our daily Bloomberg Law Brief, exploring legal issues in the news. Today, Bloomberg Law hosts June Grasso and Michael Best discuss a lawsuit between Apple and Qualcom over Qualcom's pricing structure. They speak to Matt Larson. The litigation analysts were Bloomberg Intelligence and Andrea matuition professor
at Northeastern University. Matt, let's start with the basics. Explain why Qualcom is allowed to charge phonemakers like Apple, whether or not they use its chips, and what those charges are. Certainly so, Qualcom's business is fairly unique. It's it's two fold. The first part is the chip sets. They sell chips that um they go into wireless devices and basically allow the phones to communicate with with radio and wireless networks.
And the other half of their business, um about a third of their business by revenue realistically, is patent licensing. So Qualcom invests a tremendous amount of money and doing research and development and then participates in standard setting organizations that essentially dictate what kind of technologs are going to be put into three G standards, four G l t e UM. You know there are groups talking about five G.
So Qualcom participates in these groups. It contributes the technology that it's done, that it's developed through its research programs, and then in turn, once companies start implementing those technologies, UH, Qualcom asks for compensation in the form of patent licensing. So it says, we'll let you use these technologies. UH. In fact, you have to use them because they're required to communicate with other devices, and in return, you pay us licensing fees for the use of our patented tech.
So Andrea, before we get to Qualcom's lawsuit that follows on the heels of a lot of litigation by Apple. So what what is Apple suing Qualcom about. They're allegedly not getting a stream of payments back from Qualcom in accordance with what were the previously stipulated deal terms pursuant to their agreements, which the court will undoubtedly dig into the minutia of those contracts and will learn a lot about the nature of this relationship as the case moves forward.
And so this relationship between Apple and Qualcom also was part of the concerns that are reflected in the Federal Trade Commissions Recent and Activity filing. UH against Qualcom in California, accusing Qualcom of anti competitive practices and violation of Section five of the Fair Trade of the FTC Act as well. That is Andrea Matuien, the professor at Northeastern University, and Matt Lawson, a litigation analyst for Bloomberg Intelligence, speaking to
Bloomberg Law host Grosso and Michael Best. You can listen to Bloomberg Law weekdays at one pm Wall Street Time here on Bloomberg Radio Now. Among the top legal stories from Bloomberg Law, the passenger who was dragged off that United Airlines flight earlier this week wants a judge to preserve evidence that be used in a case. David Dowell has asked that the airline and the city be required
to preserve surveillance videos, crewe lists, and other information. The Department of Homeland Security faces illegal blitz over President Trump's travel ban. The a c l U filed thirteen lawsuits demanding to see records on how the agency's field offices interpreted the ban against certain Muslim majority nations. Federal courts have thou put that ban on hold. And that's this morning's Bloomberg Lawbrary. If you can find more legal news at Bloomberg Law dot com and Bloomberg BNA dot com.
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