Christiano Amon announces the Snapdragon 855 Mobile Platform
Christiano Amon announces the Snapdragon 855 mobile platform for 5G in December. Courtesy Qualcomm

Qualcomm shares fell by nearly 11 percent Wednesday after a federal judge ruled the company violated antitrust law by suppressing competition for smartphone chips.

Shares of the San Diego-based wireless pioneer closed down 10.86 percent at $69.31 on Wall Street, and were dropping further in after-hours trading.

U.S. District Court Judge Lucy H. Koh in San Jose upheld a Federal Trade Commission decision that Qualcomm must stop bundling patent licensing with its chip sales — so-called “no license, no chips” deals.

Koh ordered Qualcomm to renegotiate license terms with its customers and refrain from any threats to withhold chips from future agreements.

Qualcomm said it will immediately seek a stay of the district court’s judgment and an expedited appeal to the U.S. Court of Appeals for the 9th Circuit.

“We strongly disagree with the judge’s conclusions, her interpretation of the facts and her application of the law,” said Don Rosenberg, executive vice president and general counsel of Qualcomm.

Bruce Hoffman, director of the FTC’s Bureau of Competition, said the “decision that Qualcomm’s practices violate the antitrust laws is an important win for competition in a key segment of the economy.”

In another federal case brought against Qualcomm by Apple, the two companies reached a settlement in the form of a six-year licensing agreement as a trial was getting underway in San Diego federal court.

Qualcomm holds key patents for 4G and 5G wireless and is a leading provider of processor chips and other technology for smartphones.

Updated at 5:20 p.m., Wednesday, May 22, 2019

Chris Jennewein

Chris Jennewein is Editor & Publisher of Times of San Diego.