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Administration's Decision Strengthens U.S. Efforts to Protect IP Rights Globally Company Renews Call for Qualcomm to Reach Swift and Fair End to Patent Infringement
IRVINE, Calif., Aug 06, 2007 -- Broadcom Corporation (Nasdaq: BRCM) today issued the following statement after a decision by the Bush Administration to let stand the U.S. International Trade Commission (ITC) order barring the importation of Qualcomm Incorporated (Nasdaq: QCOM) chips and certain cellular phones containing those chips that infringe a Broadcom patent.
"We are gratified by the decision of U.S. Trade Representative Susan Schwab not to intervene in this case," said David A. Dull, Broadcom's Senior Vice President and General Counsel. "This decision strengthens the intellectual property rights of all U.S. companies, not just Broadcom, and sends a clear message to all those who would seek to escape the consequences of their patent infringement. In upholding the ITC remedy, the Administration is also encouraging a market-based solution to patent issues that is in the best interests of American consumers, U.S. companies and global patent protection."
"The ITC remedy announced on June 7 was the measured and fair outcome of a two-year investigative process," Mr. Dull continued. "The comprehensive 60-day interagency review of the ITC order involved senior policy experts from a wide range of Executive Branch agencies, including the Office of the Trade Representative, the Treasury Department, the Department of Homeland Security, the Commerce Department and the State Department, among others. Clearly, this senior level review charged to protect the public interest fully weighed all the issues, separating fact from assertion, and just as the ITC did, concluded that protecting intellectual property rights best served that interest."
"According to the IEEE Spectrum, Broadcom possesses one of the world's most powerful semiconductor patent portfolios," Mr. Dull said. "We absolutely must protect our portfolio from the pervasive infringement in which Qualcomm has been found to engage. At the same time, our licensing and strategic alliance agreement with Verizon Communications, announced July 19, demonstrates that Broadcom is willing to work constructively to resolve intellectual property disputes. We hope today's White House decision will encourage Qualcomm to resolve this and our other disputes through prompt negotiations with Broadcom."
Last year, an ITC administrative law judge and later the Commission, in a unanimous ruling, found that Qualcomm's cellular baseband chips infringe five claims of Broadcom's U.S. Patent No. 6,714,983, which relates generally to power conservation in cellular phones. On June 7, 2007, the six-member Commission issued its Final Determination on a remedy for Qualcomm's infringement, ordering that certain Qualcomm chips that infringe the patent, and future downstream products such as cellular phones that incorporate those chips, be barred from importation into the United States.
The ITC's June 7 order was subject to a 60-day Presidential review period, which involved extensive review by U.S. Trade Representative Susan Schwab, who the President had previously designated to decide whether to let the ITC order stand or to overturn it through a statutory disapproval.
Qualcomm's Record of Infringement
To date, Qualcomm has been found to infringe four different Broadcom patents, one tried in the ITC and three others tried before a federal jury in May in Santa Ana, Calif. The Santa Ana jury found Qualcomm's infringement of the three Broadcom patents to be willful. An injunction hearing in that case, in which Broadcom is seeking to bar future infringement by Qualcomm, is set for August 14.
About Broadcom
Broadcom Corporation is a major technology innovator and global leader in semiconductors for wired and wireless communications. Broadcom products enable the delivery of voice, video, data and multimedia to and throughout the home, the office and the mobile environment. We provide the industry's broadest portfolio of state-of-the-art, system-on-a-chip and software solutions to manufacturers of computing and networking equipment, digital entertainment and broadband access products, and mobile devices. These solutions support our core mission: Connecting everything®.
Broadcom is one of the world's largest fabless semiconductor companies, with 2006 revenue of $3.67 billion, and holds over 2,200 U.S. and 900 foreign patents, more than 6,600 additional pending patent applications, and one of the broadest intellectual property portfolios addressing both wired and wireless transmission of voice, video and data. Broadcom is headquartered in Irvine, Calif., and has offices and research facilities in North America, Asia and Europe. Broadcom may be contacted at +1.949.926.5000 or at http://www.broadcom.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
All statements included or incorporated by reference in this release, other than statements or characterizations of historical fact, are forward- looking statements. These forward-looking statements are based on our current expectations, estimates and projections about our industry and business, management's beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as "anticipates," "expects," "intends," "plans," "predicts," "believes," "seeks," "estimates," "may," "will," "should," "would," "could," "potential," "continue," "ongoing," similar expressions, and variations or negatives of these words. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement.
Important factors that may cause such a difference for Broadcom in connection with our litigation with Qualcomm include, but are not limited to, our ability to prevail in the various federal and state lawsuits and other proceedings against Qualcomm, including any appeals; the ability of our patents to protect our intellectual property and products; our ability to enforce our intellectual property rights; and the risks associated with litigation in general, including the costs and time that must be devoted to litigation, the potential diversion of attention of management and key employees that may result from being engaged in litigation, and the possibility of adverse results.
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