Shares of Qualcomm Inc. plunged almost 11% on May 22 following a federal district court ruling that found the U.S. chipmaker violated antitrust rules.

In the ruling, released after the market closed on May 21, U.S. District Judge Lucy Koh said Qualcomm used its dominant market position to charge unreasonably high prices and hurt competitors in the wireless chip market. She also ordered the company to negotiate or renegotiate its license terms with customers.

Koh's ruling followed a four-week trial that ended in January. In the original complaint, filed in 2017, the U.S. Federal Trade Commission alleged that Qualcomm, as the world's dominant supplier of baseband processors — devices that manage cellular communications in mobile products — imposed onerous and anticompetitive supply and licensing terms on cell phone manufacturers.

The judge called out Qualcomm's historical practice of refusing to sell modem chips to a device manufacturer until that manufacturer signs a separate patent license agreement. The practice was deemed as leading to "unreasonably high royalty rates" because "Qualcomm receives royalties on any handset sale, even when that handset contains a rival's modem chip." Koh ordered the practice to stop.

Qualcomm said after the ruling that it will immediately seek a stay of the district court's judgment and an expedited appeal to the U.S. Court of Appeals for the 9th Circuit.

"We strongly disagree with the judge's conclusions, her interpretation of the facts and her application of the law," said Don Rosenberg, executive vice president and general counsel of Qualcomm, in a May 22 statement.

The FTC, meanwhile, cheered Koh's ruling, with FTC Bureau of Competition Director Bruce Hoffman calling it "an important win for competition in a key segment of the economy."

Qualcomm had previously been engaged in a long-running legal battle with Apple Inc. over similar allegations, but the two companies agreed in April to settle all ongoing litigation. The settlement included a payment from Apple to Qualcomm and a six-year licensing agreement.

Shares in Qualcomm closed at $69.31 on May 22, down 10.86% for the day.