ERICSSON DROPS THREE 'ESSENTIAL' PATENTS FROM LAWSUIT AGAINST QUALCOMMAND SURRENDERS TWO OTHERS SAN DIEGO, Oct. 20 /PRNewswire - AsiaNet/ -- QUALCOMM Incorporated(Nasdaq:QCOM) today announced that Ericsson, Inc. and its Swedish parentTelefonaktiebolaget LM Ericsson have dismissed with prejudice all claimsunderthree of the patents asserted against QUALCOMM in the litigation brought byEricsson in Marshall, Texas. In a further development, Ericsson, in papersfiled with the United States Patent and Trademark Office, also admitted theinvalidity of the claims of two other patents asserted against QUALCOMM inthe lawsuit, and surrendered those patents. All five patents are among theeight patents that, beginning in December 1995, Ericsson repeatedly told thetelecommunications industry were "blocking" patents or were "essential" tomake or use cellular products compliant with IS-95 and other cdmaOne(TM)standards. In December 1995, Ericsson represented to the TelecommunicationsIndustry Association and others that it held eight allegedly essential patents forIS-95. QUALCOMM challenged Ericsson's representation, and Ericsson filed apatent infringement lawsuit against QUALCOMM in Marshall, Texas inSeptember 1996, eventually bringing a total of 11 patents into the case. QUALCOMMcounterclaimed against Ericsson for unfair competition, stating in courtfilings that "Ericsson has knowingly made false and unfounded claims,including the assertion that it owns or controls patents that are'essential' to the manufacture, use or sale of products that implement the IS-95standard" with the "inten[t] that its false claims ... would have an anticompetitiveeffect and injure QUALCOMM's business." Ericsson's dismissal or surrenderof the majority of the supposedly essential patents substantiates QUALCOMM'scharge that Ericsson deliberately misled the industry. "The IS-95 standard has not changed and Ericsson's patents have notchanged since Ericsson first publicly contended that these five patents wereessential to IS-95. In light of those facts, Ericsson's recent actions andadmissions can only confirm QUALCOMM's complaint that Ericsson wrongfully and falselyclaimed essential patents," said Louis Lupin, QUALCOMM's senior vicepresident and proprietary rights counsel. "That Ericsson waited more than two yearsto dismiss these meritless claims sheds light on its motives. These eventsshow that Ericsson's statements to the industry with respect to its CDMA patentposition are not believable." Unlike QUALCOMM, whose CDMA patent position has been accepted by morethan 55 major telecommunications companies that have entered intoroyalty-bearing licenses with QUALCOMM, Ericsson has yet to announce a singleroyalty-bearing license under any of Ericsson's alleged CDMA patents for any CDMA standard.Moreover, Ericsson has not identified any essential patents it claims tohold with respect to any proposed third generation CDMA standard, including theW-CDMA proposal it has promoted in Europe, Japan and elsewhere, despitespecific requests to do so from standards-setting bodies. Consequently, it is not surprising that notwithstanding Ericsson's threatened and actuallitigation against CDMA equipment manufacturers, Ericsson's claims to holdessential CDMA patents have not been accepted. Ericsson had been contending in the Texas lawsuit that the threedismissed patents, U.S. Pat. Nos. 5,148,485, 5,239,557, and 5,430,760, coveredcertain features of IS-95 compatible products sold by QUALCOMM, and that the twosurrendered patents, U.S. Pat. Nos. 5,109,528 and 5,327,577, covered "softhandoff" in accordance with IS-95. Ericsson dropped the three patents fromthe lawsuit shortly before Ericsson was due to disclose in courtproceedings its interpretation of the meaning and scope of the allegedly infringedclaims and several months before the scheduled trial date in February 1999.Ericsson's surrender of the other two patents and admissions of invaliditywere made during reissue proceedings before the United States Patent Office in which Ericsson is applying for new claims which it argues avoid theinvalidity problems of the surrendered claims. To date, Ericsson has not dismissedits claims against QUALCOMM under the surrendered patents in the Texaslitigation. Headquartered in San Diego, Calif., QUALCOMM develops, manufactures,markets, licenses and operates advanced communications systems and productsbased on its proprietary digital wireless technologies. The Company'sprimary product areas are the OmniTRACS(R) system (a geostationary satellite-based,mobile communications system providing two-way data and position reportingservices), CDMA wireless communications systems and products and, inconjunction with others, the development of the Globalstar(TM)low-earth-orbit (LEO) satellite communications system. Other Company products include theEudora Pro(R) electronic mail software, ASIC products, and communicationsequipment and systems for government and commercial customers worldwide. For more information on QUALCOMM products and technologies, please visit theCompany's web site at . Except for the historical information contained herein, this newsrelease contains forward-looking statements that are subject to risks anduncertainties, including timely product development, the Company's abilityto successfully manufacture significant quantities of CDMA or other equipmenton a timely and profitable basis and those related to performance guarantees,change in economic conditions of the various markets the Company serves, aswell as the other risks detailed from time to time in the Company's SECreports, including the report on Form 10-K for the year ended September 28,1997 and most recent Form 10-Q. QUALCOMM, OmniTRACS and Eudora Pro are registered trademarks of QUALCOMMIncorporated. Globalstar is a trademark of Loral QUALCOMM SatelliteServices, Incorporated. SOURCE QUALCOMM Incorporated CONTACT: Christine Trimble, Corporate Communications, 619-651-3628,fax: 619-651-2590, or [email protected], or Julie Cunningham, Investor Relations, 619-658-4224, fax: 619-651-9303, [email protected], both of QUALCOMM Incorporated Web site: http://www.qualcomm.com