Qualcomm's (QCOM) move to enforce a German court's ban on older iPhone models amid Apple's (AAPL) awful Thursday is adding to the laundry list of problems CEO Tim Cook must contend with.
Shares of the phone manufacturer and service provider have declined over 8% in early afternoon trading following its surprise pre-announcement of guidance that reflected weaker iPhone sales and problems in emerging markets.
While many are looking at China after Cook largely blamed the country's market for a disappointing preemptive forecast, its former chip provider quietly moved to enforce the suspension of new sales of old iPhone models and the recall of the same models in Germany.
The enforcement continues Qualcomm's long-standing global courtroom battle against the fruit company which has seen the San Diego-based chipmaker win major decisions in both China and Germany at the close of 2018.
"Two respected courts in two different jurisdictions just in the past two weeks have now confirmed the value of Qualcomm's patents and declared Apple an infringer, ordering a ban on iPhones in the important markets of Germany and China," said Don Rosenberg, Qualcomm's executive vice president and general counsel said after the decision was handed down in December.
On Thursday, the semiconductor company announced that it has posted security bonds totaling €1.34 billion ($1.5 billion) in order to "enforce the remedies ordered by the Court" for infringement on Qualcomm's power saving technology in iPhones.
Qorvo is declining by double digits on Thursday, riding the coattails of its main customer downwards, while Intel also slide significantly.
Apple has already signaled its intention to appeal December's decision that has now become enforceable.
"Qualcomm's campaign is a desperate attempt to distract from the real issues between our companies. Their tactics, in the courts and in their everyday business, are harming innovation and harming consumers," Apple said in a scathing rebuke of its former supplier. "Qualcomm insists on charging exorbitant fees based on work they didn't do and they are being investigated by governments all around the world for their behavior. We are of course disappointed by this verdict and we plan to appeal."
Many Apple shareholders will be disappointed to se yet another headache adding to the company's inauspicious start to 2019.