FOR IMMEDIATE RELEASE
September 4, 2019
FTC v. Qualcomm: FTC Oversteps its Section 13(b)
Authority . . . Again
WASHINGTON D.C. - Last week, Cause of Action Institute (CoA Institute) filed an amicus brief in the Ninth Circuit in support of Qualcomm in FTC v. Qualcomm, Inc., No. 19-16122. CoA Institute supports the defendant’s argument that the lower court erred in its application of antitrust law as the Federal Trade Commission’s (FTC) claim is unsupported by evidence of actual harm to the competitive process.
The CoA Institute’s brief focuses on several additional ways in which the FTC exceeded its statutory authority in this case. Its arguments include the following:
- FTC may not bring novel “test cases” in federal court – the proper forum for this case would have been its in-house administrative court;
- FTC’s antitrust liability theories fly in the face of existing patent law and are contrary to Supreme Court precedent;
- Running afoul of due process guarantees, the mandatory injunction imposed by the lower court is improperly vague and exceeds the FTC’s statutory authority.
CoA Institute counsel Michael Pepson noted, “this unprecedented, highly controversial case of international importance represents FTC’s latest ultra vires attempt to expand its powers. It does so here by seeking to transmogrify an alleged breach of contract into an antitrust violation.” Co-counsel Jessica Thompson added, “this ruling, if allowed to stand, deters innovation and damages the U.S. tech industry.”
Read more about CoA Instititute's amicus brief on our blog.
Case Background:
In January 2017, a divided Commission voted 2-1 (over the dissent of Honorable then-Commissioner Maureen Ohlhausen) to authorize FTC Staff to sue Qualcomm—an innovator and U.S. leader in 5G mobile network technology—in federal court alleging that Qualcomm’s patent licensing practices violate Section 5 of the FTC Act and the Sherman Act.
In May 2019, the district court found Qualcomm liable for antitrust violations based on FTC’s novel legal theory and imposed sweeping worldwide injunctive relief. In August 2019, the U.S. Court of Appeals for the Ninth Circuit stayed the most immediately harmful portions of the injunction. In its brief, CoA argued the FTC lacked any evidence of actual or current harm to the competitive process.
About Cause of Action Institute
Cause of Action Institute is a 501(c)(3) non-profit working to enhance individual and economic liberty by limiting the power of the administrative state to make decisions that are contrary to freedom and prosperity by advocating for a transparent and accountable government free from abuse.
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