Qualcomm can maintain licensing tactics pending appeal, court says

Posted:
in General Discussion edited August 23
The U.S. Court of Appeals for the Ninth Circuit on Friday granted Qualcomm's request to stay enforcement of an antitrust ruling handed down in May, allowing the chipmaker to continue what was deemed to be anticompetitive business practices.

Qualcomm


According to the filing (PDF link), Qualcomm successfully raised "serious questions" on the merits of a district court's antitrust ruling. As such, the company can maintain existing license terms with customers, offer modem chips under condition of a customer's patent license, and is not required to offer standard essential patent licenses to modem suppliers.

The stay remains in effect until the company's appeals process is complete or is ordered otherwise by the 9th U.S. Circuit Court.

"We are pleased that the Ninth Circuit granted our request and believe the district court decision will be overturned once the merits of our appeal have been considered," Don Rosenberg, executive vice president and general counsel for Qualcomm, said in a statement to CNET.

Qualcomm is battling a Federal Trade Commission lawsuit targeting a so-called "no chips, no license" strategy. Lodged in 2017, the case alleges Qualcomm leverages its dominant power in the wireless chip industry to garner beneficial licensing and exclusivity deals with customers.

Apple, which recently settled its own legal war with Qualcomm, was among the companies cited as being injured by the chipmaker's business strategy.

In May, Judge Lucy Koh determined Qualcomm violated federal antitrust laws and ordered remedial actions that call for the firm to restructure current and future licensing tactics. Qualcomm appealed the ruling, saying capitulation would irreparably harm its lucrative patent licensing business.

Koh shut down a subsequent attempt to stay enforcement of her decision in July, forcing the issue to a higher court. That ruling came down today.

"Whether the district court's order and injunction represent a trailblazing application of the antitrust laws, or instead an improper excursion beyond the outer limits of the Sherman Act, is a matter for another day," the order reads.

The appeals court is slated to hear oral arguments in January.

Comments

  • Reply 1 of 11
    sergiozsergioz Posts: 256member

    Qualcomm is annoying! 

    edited August 23 ronn
  • Reply 2 of 11
    Qualcomm is going to stretch is out as long as they can, and they can do that for a very very long time in the USA.  What we need to be tracking is the results from other countries dealing with Qualcomm.

    Personally, I think Qualcomm was double dipping and going to get slapped down.

    But, what Qualcomm is going (was doing with licensing) is the American way.  Get the maximum possible $$$ and fight any violations in the courts...
  • Reply 3 of 11
    larryjwlarryjw Posts: 418member
    Well, Apple has a separate agreement with Qcom now, so Apple won’t be affected by this ruling. 
  • Reply 4 of 11
    badmonkbadmonk Posts: 829member
    But still WTF????!  How does an appeals court justify a decision like this?  Doesn’t this violate FRAND principles?
  • Reply 5 of 11
    gatorguygatorguy Posts: 21,105member
    badmonk said:
    But still WTF????!  How does an appeals court justify a decision like this?  Doesn’t this violate FRAND principles?
    Nope. It's not reversing the decision to find Qualcomm in violation of those principles but to delay enforcement until the appeal of the FRAND ruling itself can be heard. 
    FileMakerFeller
  • Reply 6 of 11
    ronnronn Posts: 333member
    IIRC, the appeal is being fast-tracked to finalize the case ASAP. Qualcomm didn't appeal the majority of Koh's decision. If they lose, all contracts should be allowed to be renegotiated on a fairer basis.
  • Reply 7 of 11
    gatorguygatorguy Posts: 21,105member
    ronn said:
    IIRC, the appeal is being fast-tracked to finalize the case ASAP. Qualcomm didn't appeal the majority of Koh's decision. If they lose, all contracts should be allowed to be renegotiated on a fairer basis.
    If you see as late as next March as being "fast-tracked". :)
  • Reply 8 of 11
    ronnronn Posts: 333member
    gatorguy said:
    ronn said:
    IIRC, the appeal is being fast-tracked to finalize the case ASAP. Qualcomm didn't appeal the majority of Koh's decision. If they lose, all contracts should be allowed to be renegotiated on a fairer basis.
    If you see as late as next March as being "fast-tracked". :)
    It often takes well more than a year for appeals; so yes, fast-tracked.
  • Reply 9 of 11
    MplsPMplsP Posts: 1,663member
    gatorguy said:
    badmonk said:
    But still WTF????!  How does an appeals court justify a decision like this?  Doesn’t this violate FRAND principles?
    Nope. It's not reversing the decision to find Qualcomm in violation of those principles but to delay enforcement until the appeal of the FRAND ruling itself can be heard. 
    Typically the courts make decisions like this if the company can show ‘irreparable harm’ would be caused by the ruling and/or there’s a strong likelihood of prevailing on appeal. So which was it in this case?
    FileMakerFeller
  • Reply 10 of 11
    gatorguygatorguy Posts: 21,105member
    MplsP said:
    gatorguy said:
    badmonk said:
    But still WTF????!  How does an appeals court justify a decision like this?  Doesn’t this violate FRAND principles?
    Nope. It's not reversing the decision to find Qualcomm in violation of those principles but to delay enforcement until the appeal of the FRAND ruling itself can be heard. 
    Typically the courts make decisions like this if the company can show ‘irreparable harm’ would be caused by the ruling and/or there’s a strong likelihood of prevailing on appeal. So which was it in this case?
    I think you should read their rationale in the ruling itself, but the AI article itself hints as to the reason:
    "According to the filing (PDF link), Qualcomm successfully raised "serious questions" on the merits of a district court's antitrust ruling."

    Irreparable harm? Yes that too. 

    Begin with page three. It's a short document. 

    edited August 25 FileMakerFeller
  • Reply 11 of 11
    MacProMacPro Posts: 18,368member
    larryjw said:
    Well, Apple has a separate agreement with Qcom now, so Apple won’t be affected by this ruling. 
    Right ... and Apple are the fast track to not need Qcom tech in a few years anyway aren't they?
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