Qualcomm battles against Japanese antitrust probe

In its first full response to a draft order issued more than two weeks ago by the Japanese Fair Trade Commission, Qualcomm denied that it forced Japanese companies to accept provisions of its licensing agreements and said it will argue the issue before the commission.

According to a Reuters report at the time the draft order was issued, the JFTC was looking into cross-licensing agreements the chip maker made with NEC Corp., Panasonic and Sharp. In its response, Qualcomm did not mention any specific companies.

The draft order asserts that Qualcomm forced its Japanese licensees to agree to cross-license patents on a royalty-free basis and to accept a provision under which the companies agreed not to assert their essential patents against each other. The order seeks to have Qualcomm eliminate those provisions while preserving the licensing of Qualcomm's patents to Japanese companies. However, Qualcomm said such a move could lead to the Japanese companies asserting "their previously licensed patents against Qualcomm, its customers and its licensees."

"These licenses were agreed to voluntarily by the Japanese licensees many years ago, after extensive arms-length negotiations," the company said in a statement.

Qualcomm said the "non-assert" provisions were rejected by several Japanese companies and is not even a provision in the agreements. "Qualcomm believes that requiring revisions of long-standing contracts is neither justified by the facts nor supported by the law."

Qualcomm will submit a full response to the antitrust regulators within the next few weeks. If the JFTC then submits a full order, the company said it will request a full hearing and review by the commission.

The Japanese probe came less than a week after South Korean antitrust regulators fined Qualcomm $208 million for engaging in "unfair" business practices related to its chipset sales.

For more:
- see this Qualcomm release [1]