Newsletter: California Inc.: Apple, Qualcomm slug it out over patents

Apple has sued Qualcomm, claiming the San Diego company is illegally gouging Apple on patent fees and collecting royalties on innovations it had nothing to do with.
(Associated Press)

Welcome to California Inc., the weekly newsletter of the L.A. Times Business Section.

I’m Business columnist David Lazarus, and here’s a rundown of upcoming stories this week and the highlights of last week.

Wall Street lurches back into action Tuesday after a long holiday weekend that started on a sour note — Friday’s weaker-than-expected jobs report. Employers added 156,000 net new jobs, down from payroll increases of 189,000 in July and 210,000 in June. Also, the figures for the prior two months were revised down by a total of 41,000 jobs.



New MPAA boss: Hollywood gets a new top lobbyist this week. Charles Rivkin, assistant secretary of State for economic and business affairs under former President Obama, will become chief executive of the Motion Picture Assn. of America. His first day on the job Tuesday comes as the film industry is grappling with major challenges, including box-office declines, uncertainty over the Chinese market and media consolidation.

A new Leaf: Nissan is scheduled to unveil the updated version of its Leaf electric vehicle in Detroit on Wednesday. Industry watchers expect this new iteration of the world’s best-selling EV to have greater range and better looks — and bigger sales in the U.S., where it trails the Tesla Model S and X, and the Chevy Bolt EV. The Leaf, a compact hatchback, was first introduced in the U.S. in December 2010. The 2016 version had a 106-mile range per battery charge.

Fund my firm: On Thursday, teams of entrepreneurs will unveil their start-up proposals to the public at UCLA. The teams are part of the college’s 10-week Startup UCLA program, which provides workspace, guidance, legal services and mentors to early-stage companies. The event will take place in the Palisades Room in Carnesale Commons. Check-in begins at 5:30 p.m. and the demos begin at 6. The event is free and open to the public but registration is required.

Secret spacecraft: SpaceX is set to launch the U.S. Air Force’s secretive X-37B space plane Thursday on its fifth mission from Kennedy Space Center. It’s the first time SpaceX has launched this uncrewed robotic vehicle — the last four launches were done by United Launch Alliance, a joint venture of Lockheed Martin Corp. and Boeing Co. This flight will test how special electronics and heat pipes will fare during a long-duration space mission.


Film festival: The Toronto International Film Festival opens Thursday, marking the unofficial start to Hollywood’s awards season. Nearly all major premieres at the event are hoping to jump-start a commercial release and generate early awards buzz. New movies by Darren Aronofsky (“Mother!”), Alexander Payne (“Downsizing”) and Guillermo del Toro (“The Shape of Water”) will all play during the 11-day festival.


Monday’s Business section looks at San Diego’s Qualcomm being inApple’s cross-hairs over how much it charges for its inventions. In January, Apple sued Qualcomm, cutting off royalty payments. It claims Qualcomm is illegally gouging Apple on patent fees and collecting royalties on innovations it had nothing to do with. Regulators in the U.S. and South Korea allege Qualcomm has concocted a scheme that leverages its dominance as a cellular modem chip supplier to overcharge for patent fees.



Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:

Uber news: Ride-hailing company Uber continues to be in the news. Dara Khosrowshahi, previously the low-profile chief exec of travel booking company Expedia, accepted an offer to be Uber’s next CEO. Meanwhile, Uber co-founder and former CEO Travis Kalanick got a win when a fraud lawsuit filed against him was sent to arbitration. And a news report said Uber is cooperating with a Justice Department investigation into whether the company bribed foreign officials.

Wells Fargo: Wells Fargo & Co. potentially opened 3.5 million accounts in customers’ names without permission — far more than the 2.1 million that were previously identified, the San Francisco bank said. The 3.5-million figure echoes an estimate given in the spring by attorneys in a class-action lawsuit. They negotiated a settlement based on that figure, so Wells Fargo is not expected to face vast additional payouts.

Garment workers: As retailers face increasingly tough competition from e-commerce, budget brands are putting more and more pressure on suppliers to keep prices low. The U.S. Department of Labor investigated 77 Los Angeles garment factories from April through July of 2016 and found that workers were paid as little as $4 and an average of $7 an hour for 10-hour days spent sewing clothes for Forever 21, Ross Dress for Less and TJ Maxx.


ABC cutbacks: Walt Disney’s ABC Television Group plans to make substantial job cuts, including at the broadcast network’s Burbank headquarters, in an effort to reduce costs at a time when traditional TV networks face huge challenges. The Disney/ABC Television Group, led by Ben Sherwood, is in the early stages of planning for the cuts, according to two people familiar with the plan.

Movie slump: Hollywood is wrapping up its worst-attended summer movie season in 25 years. The results have put the squeeze on the nation’s top theater chains, whose stocks have taken a drubbing. AMC Theatres CEO Adam Aron called his company’s most recent quarter “simply a bust.” Total admissions in the United States and Canada are likely to clock in at about 425 million, the lowest level since 1992.


And some recent stories from other publications that caught our eye:


Bringing it home: Best Buy and Amazon are now making house calls to advise people on what electronics they should have. The Wall Street Journal reports that both companies have launched programs to send salespeople to consumers’ homes and suggest TVs, digital assistants and other gadgets. There is no cost for the consultations. One issue is finding people to do the job. Best Buy has about 1,000 job openings and has encouraged laid-off employees to apply.

Homes at risk: A rising number of seniors are facing foreclosure after taking out reverse mortgages on their homes and then failing to pay their property taxes or insurance, reports the Washington Post. “A HUD report issued last fall found that nearly 90,000 reverse mortgage loans held by seniors were at least 12 months behind in payment of taxes and insurance, and were expected to end in ‘involuntary termination’ in fiscal 2017.”

Wearable power: A pair of entrepreneurs has invented stretchable, printable batteries, reports the San Diego Union-Tribune. Lu Yin and Rajan Kumar, founders of the start-up company Ocella, have patented an ink formulation that can be used to make batteries that can be printed on clothing or painted on walls. “They are potentially six months away from perfecting the ink formula so that, beyond stretching, its printable batteries would be washable and safe for skin contact.”

Deals for athletes: Venezuelans love baseball, but they’re angry that their government is giving sweet financial deals to baseball teams when the country is facing its deepest recession on record and many people are struggling to buy food, says Bloomberg. “Venezuelans are outraged at the government’s decision to make $10 million available for importing equipment and paying players’ salaries at a preferential rate of 10 bolivars per dollar.”



Tropical Storm Harvey is being called one of the most expensive storms in U.S. history, with damage estimates running in the tens of billions of dollars. The Times did a great job of pulling together scenes from the storm.

For the latest money news, go to Mad props to Scott J. Wilson for helping put this thing together.

Until next time, I’ll see you in the Business section.