Qualcomm has run afoul of Arm Holdings, with the latter suing the former over the licenses it acquired with its Nuvia purchase.

Arm is the world’s leading semiconductor design firm. Unlike Intel, AMD, Samsung, and others, Arm does not manufacture any chips. Instead, it designs semiconductors and licenses those designs to other companies, companies that use them to power some of the world’s most popular computing devices.

Qualcomm has been working to improve the performance of its chips, especially targeting the gap between Apple’s Arm-based chips and its own. Qualcomm purchased Nuvia in an effort to close that gap, but Arm is calling foul, issuing the following statement:

Arm is filing this claim to protect Arm, our partners, and the unparalleled ecosystem we have built together. Arm and its partners have invested billions of dollars to create industry-leading intellectual property. Because Qualcomm attempted to transfer Nuvia licenses without Arm’s consent, which is a standard restriction under Arm’s license agreements, Nuvia’s licenses terminated in March 2022. Before and after that date, Arm made multiple good faith efforts to seek a resolution. In contrast, Qualcomm has breached the terms of the Arm license agreement by continuing development under the terminated licenses. Arm was left with no choice other than to bring this claim against Qualcomm and Nuvia to protect our IP, our business, and to ensure customers are able to access valid Arm-based products.

At the heart of the issue is the designs Arm licensed to Nuvia, designs it says required authorization before they were transferred to Qualcomm. As a result, Arm wants a court-ordered injunction that would force Qualcomm to destroy any designs Nuvia developed that are based on Arm IP.

For its part, Qualcomm says its existing agreement with Arm cover the designs Nuvia licensed.

“Arm’s complaint ignores the fact that Qualcomm has broad, well-established license rights covering its custom-designed CPU’s, and we are confident those rights will be affirmed,” Ann Chaplin, General Counsel of Qualcomm, said in a statement to Reuters.

If the court sides with Arm, it could prove a devastating setback to Qualcomm’s plans, especially since the company is one of the leading makers of Arm-based processors for Windows PCs.