Trial begins over landmark £480m Which? smartphone claim
A potential payout for around 29 million UK smartphone users moves a step closer today, as a trial over a landmark claim brought by Which? against tech giant Qualcomm begins.
The trial will run for five weeks from 6 October at the Competition Appeal Tribunal in London. This trial will focus on whether Qualcomm held market power and if so, whether it abused its position as a dominant company.
If Which?’s first trial is successful, there will then be a second trial focusing on Qualcomm's conduct and the damage suffered by the class, that Which? has calculated at around £480 million.
The consumer champion believes Qualcomm has breached UK competition law by taking advantage of its dominance in the patent-licensing and chipset markets. The result is that it is able to charge manufacturers like Apple and Samsung inflated fees for technology licences, which have then been passed on to consumers in the form of higher prices or lower quality smartphones.
Which? is seeking damages for all affected Apple and Samsung smartphones purchased between 1 October 2015 and 9 January 2024. It was estimated that individual consumers could be due an average of around £17 per phone.
Qualcomm has already been the subject of investigations and court action around the world for similar anticompetitive behaviour.
This legal action could help millions of consumers get redress for Qualcomm’s anticompetitive abuse, as well as set a precedent to deter this behaviour in future. This is possible because of the opt-out collective action regime that was introduced by the Consumer Rights Act 2015.
It has been near impossible for individual consumers to take on big companies like Qualcomm in the past, but the collective regime allowed Which? to represent consumers where large numbers of people might have been harmed by anticompetitive conduct.
This action is vital to obtain redress for consumers and to send a clear message to powerful companies like Qualcomm, that if they engage in harmful, anticompetitive practices, Which? stands ready to take action.
Anabel Hoult, CEO of Which?, said:
“This trial is a huge moment. It shows how the power of consumers - backed by Which? - can be used to hold the biggest companies to account if they abuse their dominant position.
“Without Which? bringing this claim on behalf of millions of affected UK consumers, it would simply not be realistic for people to seek damages from the company on an individual basis – that’s why it’s so important that consumers can come together and claim the redress they are entitled to.”
-ENDS-
Notes to editors
Members of the public and the press can attend the Tribunal in person, or the trial may be watched ‘live’ via the Tribunal’s website (a “Watch Now” link to view the trial will appear on trial commencement date under Diary list on the following pages https://www.catribunal.org.uk/ and https://www.catribunal.org.uk/diary).
Visit www.smartphoneclaim.co.uk to find out more about the claim and sign up for campaign updates.
Background on the legal case
Which? has launched legal action against US tech giant Qualcomm on behalf of UK consumers who have purchased Apple and Samsung smartphones between 1 October 2015 and 9 January 2024 to win them back around £480 million in damages stemming from Qualcomm’s anticompetitive behaviour if successful.
Which?’s claim will state that Qualcomm employs two harmful and unlawful practices:
- It refuses to license its patents to other competing chipset manufacturers and,
- 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.
Together, it is argued that these abuses enable Qualcomm to charge Apple and Samsung higher fees for the licences for its patents, than would be the case if Qualcomm behaved lawfully. Which? believes that Qualcomm is using its market power to obtain an unlawfully gained advantage in its negotiations with manufacturers which enable it to insist on charging artificially high fees for its patents.
That raises manufacturing costs, which are ultimately passed on to consumers, meaning that consumers have paid more than they should have done.
Collective proceedings involve a claim brought by a class representative on behalf of a defined group of persons who have suffered loss as a result of a breach of competition law. Similar legal action has also been taken against Qualcomm in Canada and the US.
A number of competition authorities worldwide have investigated and, in some cases, fined Qualcomm for anticompetitive behaviour including the European Commission and authorities in South Korea. Some of these fines have been overturned on appeal, and some continue to be litigated.
Which?’s claim will automatically include consumers that purchased particular models of Apple or Samsung smartphones, either direct from the manufacturer or from a network operator or smartphone retailer between 1 October 2015 and 9 January 2024. Depending on the number and models of phones purchased, each class member could be entitled to around £17.
There is no guarantee that compensation will be made available in the future – the case must first be won in the Competition Appeal Tribunal, unless an earlier settlement is agreed.
About Which?
Which? is the UK’s consumer champion, here to make life simpler, fairer and safer for everyone. Our research gets to the heart of consumer issues, our advice is impartial, and our rigorous product tests lead to expert recommendations. We’re the independent consumer voice that influences politicians and lawmakers, investigates, holds businesses to account and makes change happen. As an organisation we’re not for profit and all for making consumers more powerful.
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