COURT RULING ON QUALCOMM DISPUTE

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A Korean court has ruled that the 1.3 trillion won fine levied by the Fair Trade Commission on Qualcomm, the world's number-one chipmaker, is justifiable. The verdict put an end to a lawsuit that lasted three years. Here's more.

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Back in 2017, the Fair Trade Commission imposed a fine on Qualcomm for abusing its dominant position in mobile communications technology patents to obstruct the business of its competitors. The fine amounted to 1.3 trillion won, the highest ever. Qualcomm filed a lawsuit, and after three years of what was a fierce legal battle, the Seoul High Court ruled in favor of the Fair Trade Commission. The salient point of the lawsuit was whether or not Qualcomm fairly provided the so-called "standard essential patents" to its competitors. Standard essential patents claim technologies that cannot be replaced. Companies that possess such technologies are obliged to provide them to other companies in line with fair business practices. However, the court said Qualcomm failed to do so. In its verdict, the court said that holding a dominant position in the telecom chip market, Qualcomm either rejected its competitors' requests for patents or demanded business information from them in return. The ruling also said that the chipmaker demanded separate patent contracts from mobile phone makers, such as LG Electronics and Huawei, and imposed a stipulation that allowed Qualcomm to terminate the supply of its chips when any violations of the terms and conditions were detected on the part of its business partners. The court ruled that Qualcomm's actions constituted the abuse of its market position and that the punitive measures imposed by the Fair Trade Commission were justifiable. The ruling said that Qualcomm's actions brought the company enormous profits that were used to occupy a dominant market position in terms of price, productivity and quality. Qualcomm rebutted by saying that the court's verdict is groundless and fails to reflect the market reality. The chipmaker vowed to appeal to the Supreme Court, which will likely issue a final verdict.