Broadcom's Antitrust Complaint Against Qualcomm Dismissed

Staff Reporter -- Electronic News, 9/1/2006

The United States District Court for the District of New Jersey has dismissed Broadcom Corp.'s antitrust complaint against Qualcomm Inc. in its entirety.

Originally filed in July of 2005, the complaint alleged a variety of purported antitrust violations by Qualcomm, each of which was rejected by the District Court.

In all, Broadcom has asserted that Qualcomm chips infringe 18 U.S. patents.

In a 47-page opinion, the court held that Qualcomm's sales and licensing activities as alleged by Broadcom "do not support an inference that competition in the UMTS chipset market is, or will be injured by Qualcomm's licensing practices." As to the complaint's allegations regarding Qualcomm's purported refusal to grant Broadcom a license for patents essential to the WCDMA 3G cellular standard on fair, reasonable and non-discriminatory terms, the court held "that Qualcomm's alleged conduct does not support claims for monopolization or attempted monopolization."

However, Broadcom said today that it has no intention of backing down from its courtroom tussle with Qualcomm. The company announced that it plans to continue to pursue U.S. federal antitrust claims against Qualcomm in response to the dismissal.

The judge expressly granted Broadcom the right to file an amended complaint for Qualcomm's alleged misconduct.

"Qualcomm should take little comfort in the court's decision," David A. Dull, Broadcom's senior VP of business affairs and general counsel, said in a statement. "The decision does not find that Qualcomm's alleged misconduct was lawful or that Qualcomm honored its promises to standards setting bodies. Rather, Judge Mary Cooper simply held that Qualcomm's alleged abuse does not give rise to federal antitrust liability."

Furthermore, Broadcom believes Judge Cooper's decision is at odds with established precedent, the company added in the statement. Broadcom is evaluating its next legal steps in the New Jersey action, which could include moving for reconsideration by the court, appealing the decision to the U.S. Third Circuit Court of Appeals, or filing an amended complaint.

The company is also taking the battle overseas: Broadcom has also filed a complaint on similar grounds with the European Commission, and expects a decision later this year as to whether the EC will launch a formal investigation into Qualcomm's practices.

Qualcomm, for its part, is satisfied with the ruling. "Qualcomm is pleased by the court's thoughtful and comprehensive ruling dismissing all of Broadcom's claims," Steve Altman, Qualcomm's president, said in a separate statement. The company could not be reached for further response to Broadcom's reaction.

A decision from the U.S. International Trade Commission on whether Qualcomm infringes three of those patents is expected October 10.