Qualcomm Under Fire For 'anticompetitive' Patent Shenanigans Causing Pricey UK Smartphones

The UK Consumer's Association has kicked off a claim against chipmaker Qualcomm, alleging that its licensing activities have resulted in UK 4G smartphone owners being overcharged.

Led by Which?, the claim focuses on an alleged breach of UK competition law by Qualcomm in how much it charged poor little Apple and Samsung for the use of its patents, "taking advantage of its dominance."

Apple and Samsung, said Which?, simply passed these "inflated fees" onto consumers in the form of higher smartphone prices.

The claim itself is concerned with two alleged practices. The first is Qualcomm's refusal to licence its patents to competing chipset manufacturers. The second is its refusal to supply chipsets to smartphone makers (in this case Apple and Samsung) unless those companies pick up a separate licence and pay Qualcomm some hefty royalties. Which? claimed Qualcomm was "abusing its position" and "employing an anticompetitive strategy ... in breach of competition law."

The group has more information on the collective proceeding here, although it has not shared the filing itself. Ultimately, it will appear here, at the United Kingdom Competition Appeal Tribunal (CAT). The tribunal still needs to approve Which's application to act as class representative before the case can proceed.

Which? is using the opt-out collective action regime introduced by the Consumer Rights Act of 2015 to take on Qualcomm and reckons that around 29 million Brits might be entitled to a payout.

If the group were to win, the amount potentially owed to consumers could be closer to a cool half a billion in UK currency, although once divided between those affected, the amount returned to an individual's pockets could be anywhere from £5 to £30. Which? reckons that most consumers could be in line for £17 should things go its way.

Qualcomm has been in and out of the courts over the years regarding its patent practices. In 2017, the chipmaker was slapped with a US lawsuit over alleged monopolistic behaviour over its cellular technology. In 2019, a judge in California ruled in favour of the US's FTC only for an appeals court to reverse the antitrust ruling last year.

The company has fared less well in its run-ins with EU antitrust regulators in which it has racked up some impressive fines. Qualcomm recently lost a fight to stop EU lawmakers from demanding data from the firm, despite its claims that the request exceeded the investigation's scope.

The Which? action does therefore carry a slight whiff of piggybacking about it, and the self-declared consumer champion pointed to Qualcomm's existing antitrust woes. "Similar legal action has also been taken against Qualcomm in Canada and the US," Which? said, and urged the company "to settle this claim without the need for litigation by offering consumers their money back."

There is no guarantee of a win, and Qualcomm has demonstrated a willingness to defend itself in the past. Those looking forward to a crisp fiver or so courtesy of the chipmaker might therefore have a while to wait.

A Qualcomm spokesperson told The Register: "There is no basis for this lawsuit. As the plaintiffs are well aware, their claims were effectively put to rest last summer by a unanimous panel of judges at the Ninth Circuit Court of Appeals in the United States." ®