Qualcomm Asks American Court For Documents In Korean investigation

Qualcomm wants to get documents from seven tech companies for winning a legal battle.

Qualcomm has taken a step to win a legal battle by asking an American federal court to force some of its largest rivals and customers, including Samsung Electronics and Apple, to give every documents they gave to the South Korean antitrust authorities, which are conducting an investigation against the chipmaker.

The move, which a number of legal experts have referred to as unusual method, risks setting off court disputes with organizations, including Qualcomm’s two prime buyers. The South Korean organization and Apple devices manufacturers contributed to over 10% of the sales revenue earned by Qualcomm in the financial year ending in September.

The semi-conductor manufacturer recently lodged applications in the American District Court in San Jose, California for subpoenas that will provide an opportunity to get documents or other evidence from 7 organizations. The rest of the named parties are Via Technologies, Broadcom, Texas Instruments, Intel Corporation and MediaTek’s US arm.

Those five organizations delivered chips used in smartphones that battle with the company’s wireless modem chips or processors. Apple and Samsung, besides being customers of Qualcomm, manufacture processors utilized in the smartphones manufactured by them.

Representatives of Samsung, Apple, Via and Intel didn’t commented, whereas their rivals at MediTek and Broadcom could not be reached. In its most recent court documents, the company said that it's seeking details, which could play a role in preparing for antitrust proceedings to be held in the South Korean region probably in the upcoming spring.

It stated that seven organizations supplied testimony and documents to officials of Korea Fair Trade Commission that have been kept secret under the procedures of South Korea. Though Qualcomm leads the market for mobile chips, it earns a major portion of its profits from the patent royalties it charges.

Its authorizing practices have led to antitrust inquiries on 3 continents, inclusive of a pending inquiry conducted by the United States Federal Trade Commission and an investigation in China which ended last year. A focus that has recurred is the practice of Qualcomm to charge royalty to smartphone manufacturers depending upon a portion of their products’ wholesale prices. The company does not license its technology to rest of the parties like chip manufacturers who deliver their products for lower prices.

If Qualcomm bases its royalties on products offered for lower prices, then it would earn lower royalty. Its settlement with authorities of China did not threaten that scheme, but it stated in November that such “per device” royalties were declared illegal by KFTC’s staff.