FTC Abandons Antitrust Lawsuit Against Qualcomm

[MacRumors]

The United States Federal Trade Commission is abandoning its antitrust lawsuit against Qualcomm, reports Bloomberg. The FTC will not seek a Supreme Court review of a 2020 federal appeals court decision that determined that Qualcomm's licensing practices are fair and not anticompetitive.

In a statement, FTC chairwoman Rebecca Kelly Slaughter said that the FTC's conclusion that Qualcomm violated antitrust laws was correct, but the agency is facing "significant headwinds" attempting to get the appeals court ruling overturned.

"Given the significant headwinds facing the Commission in this matter, the FTC will not petition the Supreme Court to review the decision of the Court of Appeals for the Ninth Circuit in FTC v. Qualcomm. The FTC's staff did an exceptional job presenting the case, and I continue to believe that the district court's conclusion that Qualcomm violated the antitrust laws was entirely correct and that the court of appeals erred in concluding otherwise. Now more than ever, the FTC and other law enforcement agencies need to boldly enforce the antitrust laws to guard against abusive behavior by dominant firms, including in high-technology markets and those that involve intellectual property. I am particularly concerned about the potential for anticompetitive or unfair behavior in the context of standard setting and the FTC will closely monitor conduct in this arena."

The FTC originally sued Qualcomm in 2017, accusing the company of using anticompetitive tactics to remain the main supplier for baseband processors for smartphones.

In May 2019, the FTC initially won its lawsuit against Qualcomm, with Judge Lucy Koh ordering Qualcomm to renegotiate all licensing terms with its customers and make patent licenses available to rival cellular modem suppliers on fair, reasonable, and non-discriminatory or "FRAND" terms. Qualcomm was also told not to enter exclusive agreements for the supply of modem chips.

Qualcomm appealed the ruling and in 2020, scored a major victory. The appeals court overturned Judge Koh's decision, and vacated the order mandating that Qualcomm re-establish all of its licensing deals.

The appeals court said that Koh's ruling went "beyond the scope" of antitrust law and that Qualcomm's licensing practices were not anticompetitive because Qualcomm is "under no antitrust duty to license rival chip suppliers."

With the FTC not planning to further pursue the case after the appeals court ruling, the four-year antitrust legal battle that Qualcomm has been facing is effectively over.

The FTC's lawsuit ran concurrent with the now-resolved legal dispute between Apple and Qualcomm. Apple accused Qualcomm of unfair licensing deals and overcharging for the iPhone components that it supplied to Apple, but Apple dropped the case and reached a settlement with Qualcomm in 2019 after it became clear there were no other options for 5G modems for use in 2020 iPhones.

Apple had planned to use Intel chips, but Intel was not able to produce the chips that Apple needed and ultimately sold its modem business to Apple for $1 billion. Apple plans to use Qualcomm chips for the next few iPhones, but the company is working on manufacturing its own modem chips in house for future devices.

Article Link: FTC Abandons Antitrust Lawsuit Against Qualcomm

 

[haunebu]

Good. Was a complete waste of time anyway.

 

[7thson]

I know it’s cynical, but I think the reason apple removed the headphones and charging adapter from the box is to offset their settlement with Qualcomm. Yeah, I know correlation doesn’t equal causation but Qualcomm chips show back up in iPhones and the accessories diminish to just a cable.

 

[haunebu]

I think the reason apple removed the headphones and charging adapter from the box is to make more money. They know the vast majority of us will buy the iPhone anyway, and pay extra for the accessories.

 

[djcerla]

Qualcomm? No monopoly, AT ALL. Time for another Apple Books antitrust lawsuit.

 

[JPack]

Of course Apple would support this lawsuit. It would defang Qualcomm and its ability to design chips for Android. The fact that Apple withheld legitimate royalty payments tells you they tried to starve Qualcomm.

But it's abudantly clear that Judge Koh made an error and there was no way to argue the case in favor of the FTC.

There are SEPs in the baseband processor, the baseband software, along with the cell towers. Is Judge Koh going to force Huawei or Ericsson to license out these patents as well?

 

[GeoStructural]

Remember when Apple pulled an Epic on Qualcomm and deliberately broke their licensing agreement unilaterally for considering it unfair... something for you to think about. At the end it was the user who lost by having to settle for lower quality modems.

 

[hot-gril]

I know it’s cynical, but I think the reason apple removed the headphones and charging adapter from the box is to offset their settlement with Qualcomm. Yeah, I know correlation doesn’t equal causation but Qualcomm chips show back up in iPhones and the accessories diminish to just a cable.

Qualcomm settlement or not, Apple will want to make more money if there's a way.

 

[AppleMad98004]

Only can an inept government body claim after a court rules against it AND then they decide to drop the case but still says "we were correct that they violated the law"....Wow.

 

[TheYayAreaLiving 🎗️]

Good move! This will save money and time.

 

[PinkyMacGodess]

This is disappointing... Is the FTC in need of some teeth?

 

[MauiPa]

That’s discouraging. For a patent troll, at least Qualcomm does make products

 

[Baritone_Guy]

Qualcomm? No monopoly, AT ALL. Time for another Apple Books antitrust lawsuit.

I got $300 out of that. If memory serves correct I think there might even have been two times I got money back

 

[msp3]

>tfw big tech's bribes to politicians and bureaucrats kicks in

 

[tongxinshe]

NSA INSTRUCTED all parties to change course. First the court, now the FTC, all of them have no choice but to follow the ORDERs from NSA!

 

[mtneer]

Wow.. wonder if QCOM will ask the court for reimbursement of its legal costs from taxpayers. All this pomp and circumstance over all these years for what?

 

[AxiomaticRubric]

I know it’s cynical, but I think the reason apple removed the headphones and charging adapter from the box is to offset their settlement with Qualcomm. Yeah, I know correlation doesn’t equal causation but Qualcomm chips show back up in iPhones and the accessories diminish to just a cable.

That is definitely possible. It was clearly a move to boost accessory revenue by requiring two separate purchases: one for a charger, one for a cable. Apple hides this behind an environmental excuse.

 

[macsareveryinteresting]

Qualcomm? No monopoly, AT ALL. Time for another Apple Books antitrust lawsuit.

Why would they put another lawsuit on Apple Books?

 

[haunebu]

This is disappointing... Is the FTC in need of some teeth?

I think the FTC was in need of a case. Like, a real case that stands up under scrutiny. This one was a waste of time.

 

[sw1tcher]

I know it’s cynical, but I think the reason apple removed the headphones and charging adapter from the box is to offset their settlement with Qualcomm. Yeah, I know correlation doesn’t equal causation but Qualcomm chips show back up in iPhones and the accessories diminish to just a cable.

The audio chip for headphones wasn't from Qualcomm. It was from Cirrus Logic

 

[7thson]

Qualcomm settlement or not, Apple will want to make more money if there's a way.

Yeah but that can be said of any for profit corporation, especially one valued at $3 trillion. I was looking for the pattern that points to the behavior but this assertion, that it was just for profit, makes my conclusion less cynical in comparison. So yay for that I guess.

 

[7thson]

The audio chip for headphones wasn't from Qualcomm. It was from Cirrus Logic

My assertion is the Qualcomm modem coupled with the royalties and settlement $ lead Apple to cut corners on accessories. Nothing to do with the component cost of the accessories, which by most accounts is pretty minimal when produced in quantities of millions.

 

[Apple_Robert]

This is disappointing... Is the FTC in need of some teeth?

They need Cahoonas.

 

[wigby]

I think the reason apple removed the headphones and charging adapter from the box is to make more money. They know the vast majority of us will buy the iPhone anyway, and pay extra for the accessories.

There's a difference between making more money and saving more money. Apple could be losing customers by not including conveniences that were once included in the box. But they are definitely saving money by not including them and hopefully putting that money towards tech that most customers care more about. I have a drawer full of chargers and EarPods so I'm happy to pay the same price for my next iPhone in exchange for something other than that junk.

 

[Jakewilk]

Remember when Apple pulled an Epic on Qualcomm and deliberately broke their licensing agreement unilaterally for considering it unfair... something for you to think about. At the end it was the user who lost by having to settle for lower quality modems.

Apparently withholding payments is common practice among businesses when litigation is ongoing. It’s not a violation of the contract until the litigation is resolved, I guess. Epic, however, intentionally broke the app store developer agreement and were punished according to the agreement that they had entered into