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Qualcomm, FTC Ask Judge To Delay Ruling To Pursue Settlement

Qualcomm Inc and the U.S. Federal Trade Commission on Monday asked a federal judge to delay a preliminary ruling in an antitrust case U.S. regulators brought against the mobile chip company in order to pursue settlement talks.

In a joint filing in the U.S. District Court for the Northern District of California in San Jose, they asked a judge to delay ruling on the FTC’s motion for partial summary judgment for 30 days.

The FTC originally filed the lawsuit in early 2017, alleging Qualcomm used anti-competitive practices to maintain a monopoly on the market for mobile phone chips.

Qualcomm declined to comment beyond the filing.

Settling with U.S. regulators would be a turning point for the San Diego company, which has been defending its business model amid a barrage of lawsuits from large customers such as Apple Inc and Huawei Technologies Inc, as well as dealing with regulatory challenges to its practices around the world.

At issue in the civil litigation and regulatory disputes is whether Qualcomm’s patent licensing practices, when combined with its chip business, constitute anticompetitive behavior. Regulators in South Korea and Taiwan initially ruled against Qualcomm, but it has appealed the rulings and settled some of them.

In Taiwan in August, Qualcomm settled with regulators for $93 million and an agreement to invest $700 million in the country over the next five years.

Settling legal disputes will also be critical if Qualcomm Chief Executive Steve Mollenkopf wants to meet the company’s ambitious financial goals.

Facing a hostile takeover bid earlier this year from Broadcom Inc, Mollenkopf said Qualcomm aimed to earn up to $7.50 in adjusted earnings per share by the company’s fiscal 2019, a goal that hinges on cost cutting and patching up relations with customers and regulators.

Qualcomm has been able to keep the core of its patent licensing model intact, reaching deals with regulators and big customers like Samsung Electronics Co Ltd to continue allowing its practice of taking the cut of the adjusted selling price of a mobile phone in exchange for the use of Qualcomm patents.

The company has yet to smooth over relations with Apple, whose antitrust lawsuit against Qualcomm was filed early last year and has yet to go to trial. – Reuters

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