FTC drops Four-Year Long Antitrust lawsuit against Qualcomm

After a four-year-long legal battle, the US Federal Trade Commission (FTC) has finally decided to drop its antitrust litigation against world-famous US chip-making giant Qualcomm. The U.S. Federal Trade Commission said, “We will abandon our long-running antitrust lawsuit against Qualcomm and have no plans to seek a Supreme Court review of a federal appeals court ruling in favor of the chipmaker.”

This decision of FTC not moving forward with the case puts a full stop to a four-year-long saga in which the federal government sought to prove that Qualcomm was abusing its dominant position in the industry of chipmaking with the aim to extract exorbitant licensing fees from several cellphone manufacturers. FTC Acting Chairwoman Rebecca Kelly Slaughter in a statement said, “I agree with an initial trial court ruling that found Qualcomm unlawfully suppressed competition, but it is true that the FTC faces significant headwinds to overturn a subsequent appeal.”

"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," Slaughter said. "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."

Charges were first levied in the year 2017 when the FTC accused Qualcomm of foisting several unfair wireless chip licensing provisions. Judge Lucy Koh subsequently found Qualcomm guilty in her ruling in violation of antitrust law in the year 2019. The jurist further attached a number of remedial actions to her ruling which further include a restructuring of licensing agreements and a modification of the company's stance on licensing terms.

Qualcomm successfully appealed Koh's decision in the last month of August where they argued in its favor that its licensing strategy drove acceleration and improvement to great extent within the industry of smartphone modem. As a result, it was beneficial to the whole market.