WASHINGTON — The App Association has asked a federal court to deny Qualcomm's request that it stay a lower court's ruling while the chip manufacturer appeals that decision, saying a stay would jeopardize the rollout of 5G.
The U.S. District Court for the Northern District of California ruled in May that the way Qualcomm licensed its modem chips for handsets was anticompetitive — siding with the Federal Trade Commission, which had sued the company for having "harmed competition in two markets for baseband processors [modem chips]."
The decision means the company must license its chips to other suppliers on fair, reasonable, and nondiscriminatory (FRAND) terms.
Qualcomm sought an immediate stay of the district court decision as well as expedited appeal to the 9th U.S. Circuit Court of Appeals.
It disputed Judge Lucy Koh's "conclusions, interpretation of the facts and application of the law," and said that her decision would "fundamentally" change its business in ways that conflict with longstanding industry practice.
The App Association takes issue with that. It told the court in its filing that "domestic rollout of and investment in 5G networks will be severely harmed if the motion to stay is granted" as well as a a national security threat.
"The injunction requires only that Appellant abide by promises and practices that it had long advocated to both investors and the U.S. courts, and that other successful companies have followed for decades. On the other hand, the requested stay would cause severe harm to the Association’s industry, the wireless ecosystem, and the public interest," it told the court.
In January 2017, the FTC charged Qualcomm with using anticompetitive tactics to monopolize the supply of a key technology for cell phones and other devices.
On the specific issue of its essential patents, the FTC said that Qualcomm's essential patents were adopted by a standards-setting body — of which Qualcomm was a member — in exchange for which participants "typically commit" to license the patents on those FRAND terms. But the FTC concluded that "despite its commitment to license standard-essential patents on FRAND terms, Qualcomm has consistently refused to license those patents to competing suppliers of baseband processors."
The FTC had asked the court to make Qualcomm "cease its anticompetitive conduct and take actions to restore competitive conditions."