In this paper, we show how statistical decision theory can be used to solve real life product problems. Global Positioning System (GPS) performance in a mobile handset degrades whenever it is simultaneously used with a 3G data or voice service. This degradation is due to the 3G transmitter interference. Mitigation methods to interference in GPS have been proposed. However, most of these methods depend on hardware and signal processing or just hardware solutions. In some cases, it maybe difficult to implement these hardware methods, especially in mobile handsets due to its small size, printed circuit board (PCB) layout issues and the added cost. In this paper, a novel signal processing statistical algorithm approach is proposed to mitigate the 3G interference to GPS. This statistical approach utilizes the knowledge of the statistical characteristics and distributions of both the GPS signal and noise. Then the method utilizes the probabilities to make a statistical decision to remove the effect of noise. This method does not require room on the PCB of the mobile handset and therefore no layout challenges arise. In addition, cost is minimized and the product turn in cycle is shortened. This paper offers theoretical as well as practical insight to the GPS operation during 3G call inside the mobile phone.