Judge Rules Qualcomm's Practices Violate Antitrust Law, Orders Changes
22 Mai 2019 - 11:28AM
Dow Jones News
By Tripp Mickle, Brent Kendall and Asa Fitch
Qualcomm Inc. unlawfully suppressed competition in the market
for cellphone chips and used its dominant position to exact
excessive licensing fees, a federal judge ruled in a decision that
could challenge the company's business model and shake up the
smartphone industry.
The decision by U.S. District Judge Lucy Koh in San Jose, made
public late Tuesday night, sided with the Federal Trade Commission,
which brought an antitrust lawsuit against Qualcomm in January
2017. The ruling comes one month after Qualcomm struck a settlement
in a separate but similar lawsuit brought by Apple Inc., which
agreed to continue paying licensing fees.
Judge Koh found that Qualcomm violated antitrust law, charging
unreasonably high royalties for its patents and eliminating rivals.
She challenged its practice of collecting billions of dollars by
charging royalties on a percentage of a smartphone's price.
"Qualcomm's licensing practices have strangled competition" in
key parts of the modem chip market for years, "and harmed rivals,
OEMs, and end consumers in the process," the judge wrote. She added
that the company's lead in developing modem chips for smartphones
using 5G, the new generation of cellular technology, made it likely
that behavior would continue.
The judge ordered that Qualcomm negotiate or renegotiate
licensing agreements with customers free of unfair tactics, such as
threatening to cut off access to its chips. Qualcomm also must
license its patents to rival chip makers at fair and reasonable
prices, and can't sign exclusive supply agreements with smartphone
makers like Apple that block rivals from selling chips into
devices.
Judge Koh said Qualcomm must submit to monitoring for the next
seven years to ensure it abides by the remedies.
Qualcomm didn't immediately respond to a request for comment
late Tuesday.
Write to Tripp Mickle at Tripp.Mickle@wsj.com, Brent Kendall at
brent.kendall@wsj.com and Asa Fitch at asa.fitch@wsj.com
(END) Dow Jones Newswires
May 22, 2019 05:13 ET (09:13 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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