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QUALCOMM, TI Come to Terms

QUALCOMM has chosen privacy over litigation in its licensing scuffle with Texas Instruments.

The San Diego-based wireless giant has halted its $18 million suit against Dallas-based TI , according to published reports. The two sides were negotiating a confidentiality portion of a CDMA cross-licensing agreement that QUALCOMM uses when it works with mobile phone handset manufacturers.

QUALCOMM filed suit against TI July 25, 2003, alleging a material breach of the confidentiality of the agreement. TI filed suit September 23, 2003, alleging that QUALCOMM violated the cross-license agreement by granting royalty discounts to handset makers that use QUALCOMM's semiconductor products. The court indicated back in July that it intended to grant QUALCOMM's motion that it did not breach the agreement on this issue.

The court was expected to consider QUALCOMM's claims for damages based on a non-material breach at a trial this week. Sources quoted by Reuters suggest QUALCOMM backed down because it feared a trial would uncover its trade secrets.

Representatives from QUALCOMM and TI were not immediately available to comment.

Ever since inking the deal, the two companies have had a healthy competition. That changed in May when TI threw down the gauntlet saying it will "expand its presence" in the CDMA market -- a space QUALCOMM rules with an iron fist since it created the technology.

TI is currently working on CDMA2000 products and said it is on track to produce a single-chip cell phone, "with all of a cell phone's key functions integrated onto one chip" by the end of 2004.

A new claim from QUALCOMM, filed last month, again alleging that TI has breached the licensing agreement is the only suit left between the two companies.