Apple, Intel, CCIA Urge ITC to Reject Qualcomm’s Call for iPhone Import Ban

IPhones "are widely used by millions of consumers to perform essential personal, commercial, governmental, health, and safety-related tasks unrelated to the asserted patents" that are at issue in Qualcomm's complaint, Apple said. "These tasks include placing calls, sending email, navigation, monitoring health, and receiving help in the event of emergencies. The iPhone 7 includes increased features that improve access to those technologies for people with visual impairments and other disabilities." Because Intel is Qualcomm’s last remaining competitor in the sale of premium LTE chipsets, the "net effect" of Qualcomm’s request for an import ban would be "to complete and extend its monopoly," Apple said. Qualcomm’s complaint also "seeks an end-run around the agency and parties challenging its exclusionary monopoly practices under the antitrust laws," it said

"Market actors" and government agencies that "rarely see eye to eye" agree that Qualcomm’s anticompetitive practices "must be stopped," Apple said. "Qualcomm’s reaction has been to retaliate against those who dare challenge its entrenched monopoly, including Apple and Intel. Only recently, after years of monopolistic practices by Qualcomm that suppressed competition, stifled innovation, and resulted in price gouging, has Intel finally gained a foothold in the premium baseband chipset business as Qualcomm’s only true competitor."

That Qualcomm seeks the exclusion of “allegedly infringing” iPhones that include a modem made by Intel “is a transparent effort to stave off lawful competition from Qualcomm’s only remaining rival,” Intel said. This “twisted use” of the ITC’s process “is just the latest in a long line of anticompetitive strategies that Qualcomm has used to quash incipient and potential competitors and avoid competition on the merits,” it said.

If the commission “entertains” Qualcomm’s complaint against Apple, “it should do so with full awareness of Qualcomm’s abusive practices and the risks to the public interest from the exclusion order Qualcomm seeks,” Intel said. Should commissioners vote to open an investigation into Qualcomm’s complaint, they should “delegate” the complaint’s public-interest considerations to an administrative law judge “for development of an evidentiary record that takes the full measure of Qualcomm’s long history of anticompetitive conduct and the strong public interest in refusing an exclusion order here,” Intel said.

The Computer & Communications Industry Association also wants the ITC to reject Qualcomm’s request for an import ban because that would “support practices that cause harm to consumers,” CCIA said in comments. CCIA was commenting as an interested "third party," it told the ITC. The group represents member companies that "manufacture products like those at issue" in the complaint, it said. Though the ITC historically hasn't deemed lack of availability of personal mobile electronic devices as raising public health, safety or welfare concerns, “a majority of American households rely solely on wireless devices for voice telephony,” and about 10 percent of adults “rely on smartphones as their primary Internet connection,” said CCIA. Import bans such as the one Qualcomm seeks against iPhones “should receive additional scrutiny" from the ITC, "given the potential effects,” it said.

If the import ban were imposed, “Qualcomm itself cannot replace the subject articles in a commercially reasonable amount of time, as Qualcomm does not currently manufacture smartphones and has no capacity to begin to manufacture them within a commercially reasonable time,” CCIA said. Qualcomm’s licensees also cannot replace them quickly, nor can Apple, which would need to be able to quickly replace “somewhere between” 30 and 50 percent of its total iPhone production volume, it said.

Qualcomm representatives didn't comment Friday. The company believes it holds "the high ground” in the dispute with Apple, CEO Steve Mollenkopf said Wednesday (see 1707200029).