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DRAM vendors fined $173M for price-fixing

Posted: 28 Jun 2010 ?? ?Print Version ?Bookmark and Share

Keywords:DRAM? DRAM price-fixing settlement? memory markets?

Some 32 states in the United States agreed on a $173 million-settlement with six DRAM manufacturers who "conspired in an illegal global scheme to fix prices."

In 2006, the multistate group, led by California, filed a complaint in federal district court, alleging that consumers, state agencies, universities and local governments were forced to pay illegally inflated prices for products containing DRAM chips.

The DRAM manufacturers named in the suit were Micron Technology Inc., NEC Electronics America Inc., Infineon Technologies A.G., Hynix Semiconductor Inc., Elpida Memory Inc. and Mosel-Vitelic Corp.

In the case, Samsung Electronics Co. Ltd and another company, Taiwan's Winbond Electronics Corp., reached settlement for $113 million in 2007. In a separate federal investigation, four companiesSamsung, Hynix, Infineon, and Elpidaand 12 individuals pleaded guilty to criminal price-fixing.

In 2008, a second lawsuit was filed in the state court in San Francisco on behalf of 96 local California government entities, including cities, counties, school districts, special districts, and the University of California, all of which had purchased computer equipment containing DRAM chips.

The settlement requires the companies to refrain from illegal price-fixing and to conduct extensive employee-compliance training. The settlement must be approved by the court.

In today's settlement, the defendants agreed to resolve both lawsuits, as well as lawsuits by private plaintiffs, by paying $173 million over two years plus interest to the affected consumers, schools and government offices.

The other states participating in the settlement are Arizona, Arkansas, Colorado, Florida, Hawaii, Idaho, Illinois, Iowa, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Mexico, New York, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Utah, Virginia, Washington, West Virginia, and Wisconsin.

In May, memory chipmakers, including Samsung, Hynix and Infineon, whose subsidiary Qimonda is now defunct, are expected to be fined by the European Union for illegally fixing memory chip prices, according to reports.

The total fine is expected to be about 300 million euros (about $370 million), although it is expected that many of those accused will have accepted the European Commission's proposed fine in return for a 10 percent discount, the reports said.

The other companies set to be fined are Elpida, NEC Electronics, Hitachi, Toshiba Corp., Mitsubishi Electric and Nanya Technology. Micron is set to be exempt from a fine in return for being first to reveal details about the cartel.

- Mark LaPedus
EE Times

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