Qualcomm won a partial victory Friday in its ongoing antitrust battle with the Federal Trade Commission when a federal appeals court put off parts of an earlier ruling.
In May, U.S. District Court Judge Lucy H. Koh in San Jose upheld an FTC decision that Qualcomm must stop bundling patent licensing with its chip sales — so-called “no license, no chips” deals.
But on Friday, the 9th Circuit Court of Appeals stayed much of that order, ruling that Qualcomm had demonstrated a reasonable chance of winning its appeal and that Koh’s decision risked irreparable harm to the company.
“We are satisfied that Qualcomm has shown, at minimum, the presence of serious questions on the merits of the district court’s determination that Qualcomm has an antitrust duty to license its (patents) to rival chip suppliers,” the appeals court ruled.
Qualcomm had argued that letting the ruling stand could disrupt its talks with smartphone makers over chips for 5G, the next generation of wireless data networks.
“We are pleased that the 9th Circuit granted our request and believe the district court decision will be overturned once the merits of our appeal have been considered,” said Don Rosenberg, executive vice president and general counsel for Qualcomm. “The stay, which remains in effect through the course of the appeals process, keeps intact Qualcomm’s patent-licensing practices. This will allow Qualcomm to continue to invest in inventing the fundamental technologies at the heart of mobile communications at this critical time of transition to 5G.”
The Justice Department had sided with Qualcomm, filing a brief that argued the company’s work is vital to national security.
The appeals court will hear oral arguments from both sides in January.
Updated at 11 a.m., Friday, Aug. 23, 2019