US judges block Qualcomm's efforts to put antitrust decision on hold
Signs of Qualcomm and 5G are depicted at Mobile World Congress (MWC) in Shanghai, China June 28, 2019.
Aly Song | Reuters
A US judge on Wednesday defeated Qualcomm's attempt to block the implementation of a failed antitrust smoothing against what the mobile chip provider has a complaint that could take more than a year to go through the courts.
Qualcomm has argued in court that the cancellation could prevent critical negotiations with phone manufacturers over 5G technology, forcing it to rework licensing agreements and even offering deals to competing chip providers, distorting their business in a way that would be impossible to relax if it wins on appeal.
A Qualcomm spokeswoman told Reuters that the company is planning to ask the 9th US war court immediately to hold the court's decision.
Stocks in Qualcomm were down 0.5 percent to $ 76.73 after the decision, as was much expected.
United States District Judge Lucy Koh did not give a specific reason to refuse Qualcomm's movement, but she turns off the record more evidence that Qualcomm had attempted to use to make the case, including a slideshow from internal Apple documents that Qualcomm claimed, was evidence on a coordinated effort by the iPhone manufacturer to damage Qualcomm financially. Government regulators had protested against including the light car deck, which would have become part of the official record for higher courts to review.
Qualcomm, which provides modem voltages to connect phones to wireless computer networks, is fighting a May 21[ads1] decision by Koh in a case brought by the US Federal Trade Commission. Koh states that Qualcomm's patent licensing practice had "tightened competition" and led the company to renegotiate license agreements with customers.
Among other things, the government would drastically change Qualcomm's business model by forcing it to license its patents to competing chip makers instead of telephone makers, who could potentially cut their patent royalties from several dollars by phone to pennies. These patents generate most of Qualcomm's profits.
Qualcomm May 28 asked Koh to dismiss his decision while pursuing a complaint. It argued that Koh's decision raised "serious legal issues" because, among other things, Koh obstructed market evidence that showed Apple dropped Qualcomm in favor of competitor chip supplier Intel.
Smartphone maker LG Electronics opposite Qualcomm's efforts to freeze the government. The telephone manufacturer said it was negotiating chip deliveries and patent license agreements with Qualcomm and could be forced to sign another unfair deal unless Koh's protection remains in place. The FTC also had the opposite of Qualcomm's move.
Koh's decision on Wednesday was only related to whether to put the provisions on hold temporarily as an appeal is played out. Analysts expect many phone manufacturers to negotiate critical 5G contracts with Qualcomm while the complaint begins.
