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Hogan Lovells offers key insight on global laws in new guide

Hogan Lovells’ global antitrust and competition team have partnered with Global Competition Review to create GCR’s recently published Private Litigation Guide.

The guide examines the leading issues of the day for antitrust and competition litigation, including answers to pressing questions focused on 13 different countries, allowing the reader to easily compare issues across various jurisdictions.

“Litigating antitrust or competition claims has become a global matter, requiring coordination across jurisdictions. Counsel and their clients increasingly need to understand litigation rules and procedures in a variety of countries and the differing ways courts may approach key issues,” said partners Nicholas Heaton and Benjamin Holt, who served as editors for the guide. “The landscape is continuing to evolve at a rapid pace.”

In addition to Heaton and Holt serving as editors for the guide, 10 Hogan Lovells lawyers and one law clerk authored country-specific chapters.

They include:

  • England & Wales (Heaton and counsel Paul Chaplin)
  • Germany (Partner Kim Lars Mehrbrey, counsel Lisa Hofmeister, and senior associate Sophia Jaeger)
  • Mexico (Partner Omar Guerrero Rodriguez, associate Martin Michaus Fernández, and law clerk Ana Paula Zorilla)
  • Netherlands (Partner Klaas Bisschop and senior associate Sanne Bouwers)
  • United States (Holt)

With a team of 135 lawyers in 17 countries, alongside its focus on antitrust and competition litigation, Hogan Lovells’ antitrust team assists clients with multinational mergers and joint ventures; cartel, abuse of dominance, and restrictive practice cases; and other investigations. Our antitrust, competition, and economic regulation practice offers practical support and advice, as well as government agency insight, as our lawyers have worked at the European Commission, the U.S. Department of Justice, the Federal Trade Commission, and the UK competition authority.

Apple and Qualcomm end their “Legal Beef” and drop lawsuits

The convoluted legal battle between Apple and chipmaker Qualcomm may be coming to an end. The companies said Tuesday that they’re dismissing all litigation against each other. Apple will pay Qualcomm an undisclosed sum as part of the settlement, which includes a six-year licensing agreement between the two.

The settlement also covers suits brought by Apple’s manufacturing partners, which wanted Qualcomm to repay $9 billion—a number that reportedly could have been tripled under antitrust law—that they say the chipmaker overcharged them for patent royalties.

The announcement came while Qualcomm’s lawyer was delivering his opening remarks in a trial of numerous claims and counterclaims that started Tuesday morning in San Diego, according to CNET. Qualcomm told investors last year that Apple would stop using its wireless chips, switching instead to chips made by competitors like Intel.

One potential catalyst for the settlement emerged a few hours later: Intel said it won’t make wireless modems capable of connecting to the coming generation of 5G networks. Earlier this year, Intel had said it would have sample 5G modems ready in 2019, and officially launch the products next year. With Intel no longer an option, that would explain why Apple needed to work out a new deal with Qualcomm. There are few 5G-capable networks operating yet, but Huawei, Samsung, and other smartphone makers have announced 5G-capable phones based on Qualcomm’s wireless chips.

The dispute between Apple and Qualcomm involved the unusual way Qualcomm licenses its technology to other companies. Qualcomm generally charges handset makers like Apple and Huawei around 5 percent of the total price of a phone for the right to use its technology, up to about $20 per device, according to a legal brief filed by Qualcomm. In other words, if you pay $300 for a phone that uses Qualcomm technology, $15 of that might go to the company, even if there are no chips made by Qualcomm in the device. If you paid $1,000, Qualcomm would get $20. Those licensing fees come on top of what a manufacturer would pay for Qualcomm’s chips. Apple referred to this as double-dipping and argued that Qualcomm only got away with it because it effectively holds a monopoly on high-end wireless chip technologies.

Though terms of the agreement were not disclosed, investors viewed it as good news for Qualcomm. Its shares rose 23 percent. Apple shares were little changed.

It’s not necessarily the end of the legal woes that have pitted Qualcomm against regulators around the world in recent years. The company is still awaiting a decision in an antitrust suit brought by the Federal Trade Commission alleging the company uses its dominant position in the wireless chip market to overcharge customers to use its technology.

During the FTC trial, Qualcomm said it doesn’t factor the value of its intellectual property into its chip prices. In other words, Qualcomm claims that it essentially sells the chips at a discount and then makes up for it with the patent licensing fee. It’s an odd arrangement, but it’s one that Qualcomm has had in place for decades, long before it became a major player in the semiconductor industry.

The history of Apple and Qualcomm’s legal beef sounds a bit like a Game of Thrones recap. Apple sued Qualcomm in January 2017, alleging that Qualcomm had withheld $1 billion in royalty rebates in retaliation over Apple’s cooperation with antitrust regulators in South Korea, where Qualcomm was hit with a $854 million fine in 2016.

Qualcomm countersued Apple that spring, claiming that Apple deliberately slowed Qualcomm modems used in some iPhones to cover up slower performance of Intel-made modems used in other iPhones. Apple retaliated by withholding payments for the patent licensing fees its manufacturing partners were supposed to pay to Qualcomm, and by expanding its lawsuit to include the double-dipping allegations. Qualcomm responded by suing Apple’s manufacturers over the unpaid licensing fees and by suing Apple itself for patent infringement.