Hausfeld acting for Which? in landmark collective action against Qualcomm
Hausfeld, acting for the Consumers’ Association (known as Which?), has filed an opt-out collective claim against Qualcomm, Inc. for over £480 million, on behalf of a class of around 29 million UK consumers.
Which? is alleging that Qualcomm abuses its dominance in the markets for smartphone chipsets and standard essential patents, the result of which is that Qualcomm is able to overcharge smartphone manufacturers like Apple and Samsung for its technology. Which? says that those extra costs, which are calculated as a percentage of the price of phone handsets, have been passed on to UK purchasers of Apple and Samsung smartphones.
Which?’s claim will automatically include claims for compensation for consumers that purchased particular models of Apple or Samsung smartphones, either direct from the manufacturer, from a network operator or smartphone retailer, since 1 October 2015.
Anthony Maton, Hausfeld Global Vice Chair and London Managing Partner, said:
“This claim is about seeking redress for the millions of consumers who are the ultimate victims of Qualcomm’s anticompetitive conduct and who have paid too much for their smartphones as a result. We are very pleased to be acting for Which? in their first claim utilising the opt-out regime introduced by the Consumer Rights Act 2015. This is exactly the type of claim that the opt-out regime was designed for and we hope that it will result in meaningful redress for the millions of consumers affected.”
Anabel Hoult, CEO of Which?, adds:
“We believe Qualcomm’s practices are anticompetitive and have so far taken around £480 million from UK consumers’ pockets – this needs to stop. We are sending a clear warning that if companies like Qualcomm indulge in manipulative practices which harm consumers, Which? is prepared to take action.”
Background on the legal case
Which?’s claim will state that Qualcomm employs two harmful and unlawful practices:
- It refuses to license its patents to other competing chipset manufacturers.
- It refuses to supply chipsets to smartphone manufacturers, such as Apple and Samsung, unless those companies obtain a separate licence and pay substantial royalties to Qualcomm.
It is argued that these abuses enable Qualcomm to charge Apple and Samsung higher fees for the licences for its patents, than if Qualcomm behaved lawfully. Qualcomm’s royalties are charged as a percentage of the price of smartphones and which have to be paid by smartphone manufacturers even when they don’t use Qualcomm’s chipsets.
Which? says that the higher costs are ultimately passed on to consumers and Which? will attempt to recover these under the collective regime which allows Which? to apply to pursue a claim for an aggregate award of damages on behalf of affected UK consumers.
Now the case has been filed, the next step will be for Which? to obtain permission from the Competition Appeal Tribunal to serve proceedings on Qualcomm. If granted, the Tribunal will then decide whether or not the Which? can act as the class representative and whether the claim can proceed to trial.
For more info about the claim and sign up for updates about progress with the claim, visit www.smartphoneclaim.co.uk.
Which?’s claim is funded by Augusta Ventures. Hausfeld & Co LLP are supported by a counsel team at Monckton Chambers: Jon Turner QC, Anneli Howard, Michael Armitage and Ciar McAndrew.
The case was reported widely in the news: