After success in Korea and Japan, Ericsson withdraws its complaint with the European Commission

Ericsson (NASDAQ:ERIC) has withdrawn its complaint to the European Commission regarding Qualcomm’s WCDMA (3G) licensing activities. The company will, however, continue its ongoing dialogue with competition authorities around the world in relation to Qualcomm’s licensing practices. Ericsson’s goal remains the same: To ensure a robust, enforceable and fair IPR regime for standards, particularly those relating to 3G and 4G wireless technologies.

In October 2005, Ericsson, Nokia, Broadcom, Panasonic, NEC and Texas Instruments filed coordinated complaints alleging that Qualcomm was both violating antitrust laws and breaching its own commitments to standard-setting bodies to license its declared essential patents on fair, reasonable and non-discriminatory (FRAND) terms. In support of these complaints, the companies have filed substantial economic evidence that Qualcomm’s conduct has caused mobile phone users to pay billions of Euros in unnecessary costs.

“Ericsson has cooperated with the European Commission’s four-year investigation to ensure consumers in Europe do not pay higher prices because of Qualcomm’s unfair licensing practices” Ericsson’s Vice President and Head of General Counsel’s Office Nina Macpherson said. “Our goal remains the same: To prevent any patent owner from distorting competition and extorting unreasonable, excessive royalties that reflect neither patent value nor R&D investments in the standards concerned.”

In parallel with the investigation by the European Commission, antitrust authorities in other jurisdictions initiated investigations against Qualcomm. As a result, the Korean Fair Trade Commission imposed orders concerning Qualcomm’s restrictive practices and imposed the highest fine in its history on Qualcomm. Furthermore, the Japanese Fair Trade Commission ruled that Qualcomm has engaged in licensing practices in breach of antitrust laws, and ordered Qualcomm to cease and desist certain licensing practices, in particular, from extracting inadequately remunerated licenses from its licensees.

Global open standards are greatly beneficial to consumers in that they lead to lower prices, greater competition, interoperability and the development of state-of-the-art technology. Such open standards depend on commitments from all essential patent holders to license their patents on FRAND terms.

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Ericsson is the world’s leading provider of technology and services to telecom operators. Ericsson is the leader in 2G, 3G and 4G mobile technologies, and provides support for networks with over 1 billion subscribers and has a leading position in managed services. The company’s portfolio is comprised of mobile and fixed network infrastructure, telecom services, software, broadband and multimedia solutions for operators, enterprises and the media industry. The Sony Ericsson and ST-Ericsson joint ventures provide consumers with feature-rich personal mobile devices.

Ericsson is advancing its vision of “to be the prime driver in an all-communicating world” through innovation, technology, and sustainable business solutions. Working in 175 countries, more than 75,000 employees generated revenue of SEK 209 billion (USD 32.2 billion) in 2008. Founded in 1876 with the headquarters in Stockholm, Sweden, Ericsson is listed on NASDAQ OMX Stockholm and NASDAQ New York.

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