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Lawrence McOchillo

Why is the FTC opposing Qualcomm's attempt to suspend the recent antitrust ruling?

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The US Federal Trade Commission filed an application opposing QUALCOMM Inc.’s (NASDAQ:QCOM) attempt to have the recent antitrust ruling by US Federal Judge Lucy Koh suspended as it files an appeal against the ruling.

The FTC has asked Judge Koh not to grant Qualcomm’s request given that an appeal could be held up in court for several years, while Qualcomm’s customers and partners would continue to suffer under its current practices.

LG Electronics also filed a similar application saying that it is in negotiations with Qualcomm and that the chipmaker is exploiting LG given that the Korean manufacturer depends on Qualcomm’s chips to make its smartphones.

LG’s case is compelling, given that the antitrust ruling would have slashed Qualcomm’s royalty payments for each chip from several dollars to cents. This would have been a big blow to the chipmaker given that it generates most of its revenues from patent licensing.

The Korean manufacturer further added that it was currently in negotiations with Qualcomm for a supply contract as well as a licensing agreement, and would be forced to sign an unfair deal.

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