Qualcomm's $800M fine upheld by Korea's highest court

SEOUL, April 14 (UPI) -- South Korea's Supreme Court ruled in favor of the country's antitrust regulators, maintaining that the $795 million fine on U.S. chipmaker Qualcomm for unfair business practices was valid.

The case began when Korea's Fair Trade Commission decided to levy the heavy fine in late 2016 on Qualcomm and its affiliates, saying the San Diego-based tech giant was abusing its power as the dominant player in the smartphone business.

The watchdog's assertion was that Qualcomm was violating antitrust regulations by failing to license its standard, but essential, patents on reasonable and non-discriminatory terms.

Other wrongdoings claimed by FTC included Qualcomm's exorbitant fees to smartphone manufacturers for patent usage but also not paying the proper share of patent fees to the same manufacturers.

The record fine set by the regulator was deemed a corrective measure toward preventing such "unfair business practices" in the future, with the case receiving further attention due to the global heavyweights involved, including Samsung Electronics, Intel, LG Electronics and Apple.

In early 2017, Qualcomm appealed the initial ruling, asking the Seoul High Court to nullify the verdict and cancel the massive fine. That court dismissed the appeal, and Thursday, Korea's supreme court has done the same.

Korea's FTC said it welcomed the latest court decision and vowed to ensure Qualcomm's compliance with the corrective measures.

In a statement, Qualcomm said it accepted the court's final verdict.

"Qualcomm appreciates the court's resolution of the matter, and we look forward to continuing to grow the company's longstanding commercial relationships with Korea and our partners here," it said.

With regard to the corrective measures, a Qualcomm Korea representative told UPI News Korea that the company has been abiding by them since the ruling.

This is not the first time that Qualcomm has been in trouble in Korea. In 2009, the company was hit with a $211 million fine from Korea's FTC for illegally offering discounts and rebates for purchases of its chips, as well as requiring royalties even after expiration of patent licenses.

Qualcomm contested the validity of that ruling, as well, lodging an appeal and chalking up partial success in a prolonged legal battle that ran for nearly 10 years.

In 2019, Korea's Supreme Court ruled largely but not completely against Qualcomm, upholding 80% of the fine as valid.