Photo by Pau Barrena/Bloomberg

The Justice Department and Federal Trade Commission's rift over the Qualcomm antitrust case continued on public display Thursday, as FTC accused DOJ of trying to shield the wireless connectivity giant from antitrust law.

The Justice Department's antitrust division, with the support of the Defense and Energy departments, filed a statement of interest earlier this week that asked the Ninth Circuit to stay U.S. District Judge Lucy Koh's antitrust injunction. Without a stay pending appeal, Qualcomm will be harmed and rivals such as Huawei Technologies will be strengthened as 5G connectivity is rolled out, to the detriment of U.S. national and even nuclear security, DOJ argues.

The FTC filed its opposition Thursday, engaging more on the merits of Koh's decision and less directly on national security. But it did have a few sharp words for the DOJ along the way.

“Qualcomm's argument, at bottom, is that the injunction entered below will cause it to lose revenues,” the FTC states in a brief signed by Deputy General Counsel Heather Hippsley. “But the order permits Qualcomm to secure every dollar to which it is entitled: market-based prices for its chips, and royalties that reflect the value of its patents.”

Koh found after a bench trial that Qualcomm's “no-license-no-chips” policy and its refusal to license standard-essential patents to competitors has “strangled competition” in the modem chip market. She ordered Qualcomm to offer licenses to competitors and “negotiate or renegotiate, as applicable” licenses with smartphone makers without threatening to disrupt modem chip supply.

That will help development of 5G, while promoting “national champions” won't, the FTC argues. “The policy judgment underlying the antitrust laws is that an industry will be more innovative and efficient if freed from anticompetitive constraints,” Hippsley writes.

The DOJ's claims about national security are “unsubstantiated” and misplaced. “Nothing in the remedy requires any catastrophic financial impact to Qualcomm,” she writes. “Indeed, the record shows that Qualcomm spends more on stock buybacks and dividends than it does on R&D.”

What DOJ wants is for Qualcomm to be freed from antitrust scrutiny, Hippsley contends. “If legitimate national security objectives require subsidizing Qualcomm, and taxing Qualcomm's rivals and United States consumers to do so, there are proper political channels for pursuing those objectives,” she writes. “Interference in the judicial resolution of an action to enforce the antitrust laws is not one of them.”

Other lawyers appearing on the brief with Hippsley include D. Bruce Hoffman, director of the FTC's Bureau of Competition, and the bureau's chief trial counsel, Jennifer Milici, who led the FTC's team at trial before Koh.