Reversing the district court’s judgment and permanent injunction, this decision finds that Qualcomm’s patent licensing practices do not violate the Sherman Act. The district court erred in finding anticompetitive harm from the effect Qualcomm’s licensing practices had on cell phone manufacturersp–a market in which Qualcomm did not compete–rather than on rival chip manufacturers with which Qualcomm did compete. Qualcomm’s practice of licensing only the cell phone manufacturers to use its necessary patents, while allowing rival chip manufacturers to use the patents, license and royalty free so long as they sold to manufacturers who were licensed did not harm competition in the chip market in which Qualcomm competed. Nor was it an antitrust violation for Qualcomm to charge manufacturers more for its patents than their supposed fair value. If doing so violated Qualcomm’s contracts with industry standard setting organizations, the remedy lay in a breach of contract suit, not in antitrust law.