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Infineon agrees to pay $160M fine in U.S. DRAM price-fixing probe

Posted: 20 Sep 2004 ?? ?Print Version ?Bookmark and Share

Keywords:infineon technologies? dram? memory?

Infineon Technologies AG has agreed to pay a $160 million fine as part of a federal DRAM price-fixing probe, the Justice Department said.

DoJ said the German chip maker entered a guilty plea in a San Francisco federal court to settle an antitrust case brought by the department's antitrust division. Infineon (Munich) acknowledged conspiring with other memory makers to fix DRAM prices between July 1999 and June 2002.

"Under the plea agreement, which must be approved by the court, Infineon has agreed to cooperate with the government in its ongoing investigation of other DRAM producers," DoJ said in a statement.

According to antitrust enforcers, Infineon was accused of participating in meetings with competitors in which they discussed DRAM prices for computer makers. It was also accused of exchanging DRAM sales information in order to monitor compliance with the price-fixing scheme.

A Micron Technology Inc. manager has also been charged by the Justice Department with obstruction of justice in connection with the DRAM price-fixing investigation.

A federal grand jury in San Francsico was seeking evidence from a former manager at Samsung Semiconductor Inc. regarding alleged antitrust violations by global DRAM makers.

The Justice Department also said the $160 million fine against Infineon is the third largest in U.S. antitrust history.

The fine amount is fully covered by the company's recent third quarter accrual, and is to be paid in equal installments through 2009.

Though Infineon said it strongly condemned any attempt to fix DRAM prices, the company had been preparing for several months to deal with possible fallout from the U.S. probe.

In July, Infineon indicated it would set aside $250 million to settle potential legal liabilities from the investigation.

The government's allegations were limited to a handful of OEM customers. Infineon said is already contacted the customers and is trying to reach settlements with them. Though Infineon has resolved its dispute with DoJ, the company could still face legal action from memory buying companies, who in July delayed a private antitrust lawsuit alleging that Infineon and other suppliers conspired to fix memory prices between November 2001 and June 2002.

- Spencer Chin and George Leopold

EE Times

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