- Shares of Qualcomm rose by 5% in early trading on Wednesday after the Trump administration asked a federal appeals court to delay a ruling that would force the company to alter its licensing business.
- The effort puts the Trump Administration at odds with the Federal Trade Commission, which filed the lawsuit against Qualcomm over concerns of anti competitive practices.
- Lucy Koh, the US district judge for the Northern District of California, declared a ruling on May 21 that Qualcomm had used anti-competitive practices while licensing patents in its mobile chip business.
- Watch Qualcomm trade live.
The Trump Administration is going to bat for Qualcomm, one of the largest mobile chip suppliers, in attempt to delay a court ruling that would force the chipmaker to make dramatic changes to its business.
Shares of Qualcomm rose 5% in early trading on Wednesday after the news came out. The administration asked a federal appeals court to hold off on a ruling made by US District Judge Lucy Koh that found the company applied anti-competitive practices when licensing patents in its semiconductor business.
The Trump Administration is now directly at odds with the Federal Trade Commission, one of the primary regulators that investigates antitrust cases.
The ruling, which was made on May 21, would require Qualcomm to renegotiate license agreements with phone manufacturers that purchase its chips. Qualcomm asked Koh for a delay after the ruling was made, but the judge refused.
The Department of Justice has also expressed its support for Qualcomm saying it will likely win its appeal and that Koh’s ruling disregarded established antitrust laws and policies.
“A reduction in Qualcomm’s leadership in 5G innovation and standard-setting, ‘even in the short-term,’ could ‘significantly impact US national security’ by enabling foreign-owned firms to expand their influence,” The DOJ said a court filing according to Bloomberg.
Bloomberg also reported the Defense Department and Department of Energy expressed concern in a court filing over the impact the ruling could have Qualcomm’s ability to develop 5G product and provide the US government with important technology.
Qualcomm is up 33% year-to-date.
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