States to sue chipmakers over price-fix charges
Thirty-four U.S. states will sue seven computer memory chipmakers on Friday, including Micron Technology and Infineon Technologies, over charges they conspired to rig the U.S. market to keep prices artificially high.
California Attorney General Bill Lockyer said Thursday 33 other states would join a lawsuit alleging the chipmakers violated state and federal antitrust laws during a conspiracy to fix prices for dynamic random access memory, or DRAM, chips, from 1998 through June 2002, when there was a glut in the market.
The lawsuit follows a U.S. Justice Department probe launched in 2002 that resulted in hundreds of millions of dollars in fines levied against Samsung, Hynix, Infineon, Elpida and other chipmakers.
The federal investigation followed a sharp plunge in the prices for memory chips used in computers and other electronics, which forced a wave of industry consolidation and pushed several chipmakers near bankruptcy.
Micron spokesman Dan Francisco said he could not comment specifically on the lawsuit because the company had not yet seen it. But he noted that the Boise, Idaho-based chipmaker has been in talks to resolve the issue.
"We have been involved in discussions with state attorneys general for a long period of time," Francisco said. "As I understand it they wanted to get these cases on file while we discuss the potential for resolution."
Germany's Infineon could not immediately be reached for comment on the complaint seeking damages estimated as high as hundreds of millions of dollars.
The complaint, to be filed in U.S. District Court for the Northern District of California, charges the companies with fixing DRAM chip prices, artificially restraining supply and rigging bids for contracts.
Those actions caused computer makers such as Apple Computer, Compaq Computer (now part of Hewlett-Packard), Dell, Gateway, Hewlett-Packard and IBM to pay more for chips and then pass those costs on to consumers, said Florida Attorney General Charlie Crist, another lead plaintiff in the case.
The largest four of the DRAM makers--Samsung, Hynix, Micron and Infineon--and their U.S. units control roughly 70 percent of the U.S. market, which in 2003 represented about $5 billion of the $17 billion in worldwide sales.
Lockyer said he was one of the leaders of the lawsuit because much of the alleged illegal conduct took place in California, home to Silicon Valley, where many of the chipmakers have operations.
The lawsuit names many of the world's top-ranked memory chipmakers including South Korea's Hynix Semiconductor; Taiwan's Mosel Vitelic and Nanya Technology; Japan's Elpida Memory, a joint venture of Hitachi and NEC; and NEC Electronics' NEC Electronics America.
An Elpida spokesman declined to comment as did a representative from NEC, who said the company has not yet seen the lawsuit. The other chipmakers named in the lawsuit could not immediately be reached for comment.
The lawsuit does not name South Korea's Samsung Electronics, the world's leading memory chipmaker, because California has entered into an agreement with the company in order to reach a potential settlement, said Tom Dresslar, a spokesman for the California attorney general. |
