Qualcomm Granted Appeal of Mobile Phone Owners Class Cert.

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Qualcomm was granted an immediate appeal of a massive certified Class of cellphone owners involved in a class action lawsuit alleging the company overpriced chips ubiquitous in mobile devices.

Qualcomm contends that the newly certified Class of about 250 million consumers is “simply too large and unwieldy to manage” in a petition to appeal the decision brought to the Ninth Circuit two-judge panel.

The company points out that the certified Class of cellphone owners in the United States would cover about 1.2 billion purchases.

“The court, in its discretion, grants the petition for permission to appeal the district court’s September 27, 2018 order granting class action certification,” the judges state in their decision.

The Class of individual cellphone users was certified by a California federal court in 2018. Users alleged that Qualcomm engaged in anticompetitive conduct when it came to licensing a particular chip that is found in most cellphones.

This anticompetitive conduct hiked the price of devices for consumers and reaped billions in unjust profit for the tech company, according to the Qualcomm class action lawsuit.

The plaintiffs in the Qualcomm class action lawsuit argue that the Class was appropriately certified by the California federal judge. They point out that Classes numbering in the millions have historically been certified in class action lawsuits.

However, Qualcomm argues that the decision to certify the Class failed to take into account state laws. The company points to a U.S. Supreme Court decision that limited Class certification in cases where Class Members come from states that allow indirect damages.

Plaintiffs opposing the appeal state that Qualcomm’s argument should not be taken up at this point in the litigation process.

A number of Qualcomm class action lawsuits were lodged against the tech company after it was hit with an enforcement action by the Federal Trade Commission.

The dozens of lawsuits were consolidated into multidistrict litigation (MDL) in California federal court.

The Qualcomm MDL alleges that the company extracted excessive royalty fees from cellphone makers, who passed the cost on to consumers.

Qualcomm was able to do this, allege the plaintiffs, because it controls a vast majority of the market for modem chipsets.

Modem chipsets, in essence, allow devices to connect – a fundamental part of any cellular or mobile device. Qualcomm developed the chipset that complied with communications carriers like AT&T and Verizon.

The Qualcomm class action lawsuit accuses the company of using its role to charge higher prices for the component essential to making cellphones that could communication with carrier infrastructure.

If the certified Class survives Qualcomm’s appeal, it could include every smartphone and tablet purchased in the United States.

The consumers are represented by Kalpana Srinivasan, Marc M. Seltzer, Steven G. Sklaver, Amanda K. Bonn, Oleg Elkhunovich, Krysta Kauble Pachman, Chelsea Samuels and Catriona Lavery of Susman Godfrey LLP, Joseph W. Cotchett, Adam J. Zapala, Mark F. Ram and Michael A. Montaño of Cotchett Pitre & McCarthy LLP, and Steve W. Berman, Jeffrey D. Friedman and Rio S. Pierce of Hagens Berman Sobol Shapiro LLP.

The Qualcomm Mobile Phone Class Action Lawsuit is In re: Qualcomm Patent Licensing Antitrust Litigation, Case No. 5:17-md-02773, in the U.S. District Court for the Northern District of California.

The Qualcomm Mobile Phone Appellate Case is Karen Stromberg, et al. v. Qualcomm Inc., Case No. 18-80135, in the U.S. Court of Appeals for the Ninth Circuit.