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UPDATE 1-Broadcom wins antitrust appeal against Qualcomm

Tue Sep 4, 2007 7:53pm EDT

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LOS ANGELES, Sept 4 (Reuters) - A U.S. appeals court in New Jersey ruled on Tuesday that antitrust claims brought by chipmaker Broadcom Corp (BRCM.O) against rival Qualcomm Inc (QCOM.O) over Qualcomm's licensing practices can go forward.

The ruling by the U.S. Court of Appeals for the Third Circuit reversed a lower court's dismissal of the case.

The trial court had ruled that Qualcomm's alleged conduct did not constitute antitrust activity because an industry standards board oversaw the licensing activity.

Broadcom's lawsuit accused Qualcomm of breaking a pledge to the standards board to be fair when licensing patents for technology it owned. That technology has been adopted as an industry standard to promote interoperability among handsets and carriers.

A three-judge appeals panel ruled unanimously that Broadcom had presented enough evidence to go to trial with its claims that Qualcomm "possessed monopoly power" and "maintained its market power willfully and not as a consequence of a superior product, business acumen, or historic accident."

In a statement, Broadcom General Counsel David Dull said the Irvine, California-based company plans to go to trial in New Jersey "as soon as practicable."

A Qualcomm spokeswoman had no immediate comment.

The case, filed in 2005, accused Qualcomm of engaging in anticompetitive practices to maintain a monopoly in the U.S. cell phone industry, such as giving lower royalty rates to handset makers who use Qualcomm chips and charging two royalties for handsets that used competitors' chips.



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