From Arm's complaint: "The licenses [to Nuvia] safeguarded Arm’s rights and expectations by prohibiting assignment without Arm’s consent, regardless of whether a contemplated assignee had its own Arm licenses."

If Nuvia signs an agreement "we get access to ARM tech and we won't transfer/assign our tech to someone else without ARM's agreement (even if that someone else already has ARM licenses" then the tech can't be transferred.

A big part of the complaint seems to come down to this: 1) Nuvia was granted licenses with fees and royalty rates that reflected the market opportunity and competition that Nuvia would bring to ARM's business; 2) In order to safeguard ARM's business, they needed to ensure that Nuvia couldn't transfer the technology developed under that license to someone else.

Let's look at this from ARM's perspective for a moment. ARM has major customers like Qualcomm that license chip designs. Let's say that Qualcomm is 30% of ARM's business. Let's say that architecture licenses cost 25% of what chip licenses cost. If Qualcomm can migrate from a chip license to an architecture license, then ARM loses 22.5% of its business. Let's say Qualcomm already has an architecture license because it got in on the ground floor in 2008 and there's nothing ARM can do about that. So there's always the huge threat that Qualcomm develops its own designs and ARM loses that huge portion of their business.

Now, Nuvia comes along and wants to build custom designs based of an architecture license. ARM's first thought is "Hell no! You'll just sell the designs to Qualcomm once you've proven them out." Instead, Qualcomm says "Ok, you can build the custom designs, but we get veto power over anyone acquiring the tech you build with our licenses - even if the acquirer already has licenses from us." Nuvia agrees to these terms. Their idea is that they're going to become the company to buy ARM server chips from - server chips that will be faster and more power efficient than Intel chips.

Years go by and it's hard to bring a product to market and Qualcomm comes around with a bucket of money (and a desperation to both compete with Apple and avoid being commodified by MediaTek and others licensing the same cores). Nuvia sells to Qualcomm. ARM now says "Wait a second, we didn't agree that you could transfer the tech you developed to Qualcomm. You agreed that you wouldn't do that!"

Qualcomm doesn't need Nuvia's license. Nuvia needs ARM's permission to transfer their tech to Qualcomm - because they agreed to that term (ARM alleges). Qualcomm's license (ARM alleges) doesn't allow them to incorporate ARM-based tech developed at third-party ARM licensees. The license was valid when the design was created, but it was specifically licensed only for Nuvia's use with a prohibition against being sold to a third party. When I buy a license for a movie, I can watch it in my living room, but I'm legally prohibited from exhibiting it in a theater. Licenses can have restrictions.

> And having the designs destroyed because of this wrinkle seems pretty rich.

That seems pretty reasonable to me. Qualcomm is looking to move its products forward by years based on these designs that ARM alleges Qualcomm isn't allowed to use. If Qualcomm isn't allowed to use those designs, what should the remedy be? An alternative would be that ARM could get an extremely high royalty rate on all future Qualcomm chips, but that would likely be more detrimental to Qualcomm than destroying the designs. As others have commented, it seems likely that Qualcomm will negotiate a settlement with ARM. Maybe Qualcomm could pay high rates for 3 years to compensate ARM while being able to get to market sooner and protect themselves from MediaTek and others. At the same time, ARM somewhat knows that even if the designs are destroyed, Qualcomm could likely get back to their current position in 3 years time given that they have the Nuvia employees and the resources of Qualcomm. That would let both sides move forward.