Nearly 30 million owners of a 4G smartphone could find themselves with a refund of up to £30 each if consumer rights lobbyist and watchdog Which? is successful with their legal action against manufacturer Qualcomm for inflating prices through their market domination.
Which? claims that the price inflations amounts to anti-competitive abuse and has brought its complaint before the Competition Appeals Tribunal (CAT) as it believes that Qualcomm leveraged their dominance in the market to artificially inflate the prices it can charge manufacturers which are ultimately passed onto 4G smartphone owners. CAT will decide if the claim can indeed go ahead.
4G smartphone manufacturers such as Apple and Samsung are licensed to reproduce the technology that Qualcomm has patented. The phones in question were produced from October 2015 onwards and estimate the total number of devices at around 29 million. Each phone could earn the owners up to £30 each but Which? estimates the majority of phone owners will be entitled to £17.
This is not the first time that Qualcomm has faced this type of action. They were able to successfully fend off the Federal Trade Commission in 2017 within the US court system after it was claimed they were using unfair practices.
Qualcomm has said the claims have “no basis” and will likely use a similar argument as they did previously stating “As the plaintiffs are well aware, their claims were effectively put to rest last summer by a unanimous panel of judges at the Ninth Circuit Court of Appeals in the United States.”
In 2018 they were however fined just short of €1bn by the European Commission and another €242m in 2019 for a similar case involving 3G chips which Qualcomm is attempting to appeal.
The chief executive of Which? Anabel Hoult said: “We are sending a clear warning that if companies like Qualcomm indulge in manipulative practices which harm consumers, Which? is prepared to take action.”
If you’ve bought an Apple or Samsung phone since 1/10/15, you could be owed money. Which? is taking legal action on behalf of 29 million UK consumers against US tech giant Qualcomm. To find out if you’ve overpaid & register visit https://t.co/BEaGweqdjm #SmartphoneClaim
— Which? (@WhichUK) February 25, 2021
Which? hopes to settle with Qualcomm but will use the Consumer Rights Act 2015 to their benefit if they need to, meaning they can bring the collective action on an opt-out basis. This allows them to make a collective claim on behalf of the 4G smartphone owners and as long as they haven’t opted-out they are automatically entitled to the refund without having to be identified.
Which? has stated that it believes Qualcomm to be in breach of competition law for refusing to license patents to competitors and refusing to supply chipsets to 4G smartphone manufacturers unless they obtain a separate license and pay the inflated royalties.
4G smartphone owners can check if they have one of the affected models and register by visiting a website set up by the watchdog. Not only do they hope to win compensation but they hope this action will deter companies from similar behaviour in the future.
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