Technology giant Qualcomm defended its business practices as "innocuous and lawful" during the second day of a major competition tribunal hearing in London. The class action lawsuit, brought by consumer group Which?, could result in payouts for around 29 million UK smartphone users if successful.
The five-week trial at the Competition Appeal Tribunal focuses on whether Qualcomm abused its dominant position in patent-licensing and chipset markets. Which? alleges the company charged inflated fees to manufacturers like Apple and Samsung, costs that were then passed on to consumers through higher smartphone prices.
Defence arguments
Daniel Jowell KC, representing Qualcomm, challenged the prosecution's case during opening submissions. He told the tribunal: "What turns this innocuous and lawful chipset supply policy into the abusive and unlawful NLNC (No Licence No Chips). We got to the stage where it became very puzzling because no one has ever contested that Qualcomm can't maintain both a patent licencing business and a chipset supply business."
The defence argued that the core allegation of abusive conduct lacked evidence. Jowell stated: "If the essence, or if you like the hallmark, of the abusive conduct is the effective dictation of terms, you just don't find it in the evidence."
Philip Moser KC, representing Which?, outlined the alleged abuse on Monday. He told the hearing: "Qualcomm, instead of competitive negotiation, uses the inherent risk, or sometimes explicitly stated threat, of chipset supply disruption, software delay, to foreclose a normal discussion of royalties, and conditions for the licences."
Potential outcomes
If Which? wins this initial trial, a second hearing will determine specific damages and conduct details. The consumer group has calculated potential damages at around £480 million for smartphones purchased between October 2015 and January 2024.
Individual consumers could receive an average of around £17 per affected phone if the action succeeds. Which? chief executive Anabel Hoult said: "This trial is a huge moment. It shows how the power of consumers - backed by Which? - can be used to hold the biggest companies to account if they abuse their dominant position."
The organisation described the legal action as "vital" to obtain consumer redress and send a message to powerful technology companies about anticompetitive practices.
Sources used: "PA Media" Note: This article has been edited with the help of Artificial Intelligence.
