States settle price-fixing complaint against DRAM makers

Six DRAM makers agree to pay $173 million to 33 states and affected organizations

Thirty-three states, including California, have reached a US$173 million settlement with six DRAM makers alleged to have fixed prices for their products between 1998 and 2002, California Attorney General Edmund "Jerry" Brown Jr. announced.

California and the other states -- including Massachusetts, Florida, New York and Pennsylvania -- filed a class-action lawsuit against the DRAM makers in July 2006 alleging that a price-fixing scheme hurt consumers, state agencies, universities and other groups.

The DRAM manufacturers named in the lawsuit are U.S. companies Micron Technology and NEC Electronics America, as well as Infineon Technologies from Germany, Hynix Semiconductor from South Korea, Elpida Memory from Japan, Mosel Vitelic from Taiwan and their American subsidiaries.

"These companies conspired in an illegal global scheme to fix prices on chips used in computer equipment sold to consumers, schools and government offices," Brown said in a statement. "The large price tag of this settlement should serve as a warning that we will crack down on any manufacturers around the world that choose to gouge consumers through illegal price-fixing schemes."

The breakdown of how much money each company will pay in the settlement has not yet been determined, said Christine Gasparac, a spokeswoman for Brown.

Micron declined to comment on the settlement. Representatives for NEC and Infineon didn't immediately respond to a request for comments.

An investigation conducted by Brown's office alleged that between 1998 and 2002, the salespeople and upper management of the DRAM makers held frequent meetings, made telephone calls and initiated other contacts in which they exchanged confidential pricing information. The companies agreed to charge customers inflated prices on DRAM chips, Brown alleged.

The U.S. Department of Justice has conducted its own investigation into DRAM price fixing. Four companies, Samsung Semiconductor, Hynix, Infineon and Elpida, and 12 people have pleaded guilty to criminal price-fixing in the federal case.

In October 2008, Brown filed a second lawsuit in state court 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, Brown said in a press release. The settlement must be approved by the court.

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. Samsung and another company, Winbond, reached a settlement for $113 million in 2007.

"The settlement money is welcome, but the illegal overcharging never should have happened in the first place," Brown said in his statement. "Especially when times are tight, schools and government agencies can't afford to be ripped off by companies that violate our anti-trust laws to keep profits high."

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags legalmemorymicron technologyantitrustComponentsCivil lawsuitsEdmund Brown Jr.Mosel VitelicChristine GasparacInfineon TechnologiesElpida MemoryHynix SemiconductorCalifornia Attorney General's Office

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Grant Gross

IDG News Service
Show Comments

Brand Post

PC World Evaluation Team Review - MSI GT75 TITAN

"I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it."

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?